98-0497
Income Tax
Signed 7/15/98
BEFORE THE UTAH STATE TAX
COMMISSION
____________________________________
PETITIONER, :
:
Petitioners, : DECISION
:
v. :
:
COLLECTION
DIVISION OF THE : Appeal No. 98-0497
UTAH STATE TAX COMMISSION, :
STATE OF UTAH, : Account No. #####
:
Respondent. : Tax Type: Income Tax
_____________________________________
STATEMENT OF CASE
This
matter came before the Utah State Tax Commission for an Initial Hearing
pursuant to the provisions of Utah Code Ann. §59-1-502.5 on April 28,
1998. G. Blaine Davis, Administrative
Law Judge, heard the matter for and on behalf of the Commission. Present and representing Petitioner were
NAME. Present and representing Respondent
were Ms. Laurie Allred and Ms. Vickie Christoffersen, from the Collection
Division.
Based
upon the evidence in the file and presented at the hearing, the Commission
makes its:
FINDINGS
Petitioners
took their information for their 1996 income tax return to a local CPA, who
filed a federal extension request, but did not request a state extension or
advise Petitioners to make a payment of taxes to the State of Utah to obtain a
valid extension.
After
April 15, 1997, Petitioners changed their accountant to COMPANY A, who did not
file an extension on August 15, 1997, but did prepare the return which was
filed on or before October 15, 1997.
Accordingly, a penalty was imposed upon Petitioners for having not paid a
sufficient amount of taxes to have a valid Utah extension. The Internal Revenue Service also imposed a
penalty because the August extension was not requested, but they waived that
penalty for reliance on a certified public accountant.
Petitioners
represent that their income tax for 1996 was significantly higher than it was
for 1995, because they were involved in the development and sale of properties
in Park City, and the sales culminated in 1996. The 1995 tax to the State of Utah was $$$$$, and the 1996 tax was
$$$$$.
Petitioners
had a similar problem in 1995, and had a $$$$$ penalty imposed for the same
reason, but NAME testified that she did not understand the reason for the
penalty, but simply paid it because she didn't want to spend the time or effort
to pursue the issue.
Petitioners
had approximately $$$$$ in withholding for 1996, and they therefore argue that
an additional $$$$$ would have brought them up to the amount of tax for the
prior year, so they request that the penalty either be waived, or that it be
limited to being imposed on the $$$$$ which they fell short in making the
payments equal to the prior years' taxes.
APPLICABLE LAW
The
Tax Commission is granted the authority to waive, reduce, or compromise
penalties and interest upon a showing of reasonable cause. (Utah Code Ann. §59-1-401(10).)
DECISION AND ORDER
The
Tax Commission finds sufficient cause does not exist to waive the penalty
associated with the 1996 income tax return.
It is so ordered.
This
Decision does not limit a party's right to a Formal Hearing. Any party to this case may file a written
request within thirty (30) days of the date of this decision to proceed to a
Formal Hearing. Such a request shall be
mailed to the address listed below and must include the Petitioner's name,
address, and appeal number:
Utah State Tax Commission
Appeals Division
210 North 1950 West
Salt Lake City, UT 84134
Failure
to request a Formal Hearing will preclude any further appeal rights in this
matter.
DATED
this 15 day of July, 1998.
BY ORDER OF THE UTAH STATE TAX COMMISSION.
G. BLAINE DAVIS
Administrative Law
Judge
The
agency has reviewed this case and the undersigned concur in this decision.
DATED
this 15 day of July, 1998.
BY ORDER OF THE UTAH STATE TAX COMMISSION.
W. Val
Oveson Richard
B. McKeown
Chairman Commissioner
Joe B.
Pacheco Pam
Hendrickson
Commissioner Commissioner
^^