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DEPARTMENT OF STATE REVENUE 0220050531P.LOF Letter of Findings Number: 02-0531P Assessment of Penalty NOTICE: Under IC 4-22-7-7, this document is required to be published in the Indiana Register and is effective on its date of publication. It shall remain in effect until the date it is superseded or deleted by the publication of a new document in the Indiana Register. The publication of this document will provide the general public with information about the Department's official position concerning a specific issue. ISSUE I. Tax Administration – Penalty Authority: IC 6-8.1-10-2.1(d), 45 IAC 15-11-2. The taxpayer protests the assessment and imposition of penalty. STATEMENT OF FACTS Taxpayer was audited and was assessed additional taxes, as well as interest and penalty due. Taxpayer paid the tax and interest, but protested the assessment and imposition of penalty. I. Tax Administration – Penalty DISCUSSION IC 6-8.1-10-2.1(d), Liability for penalty, states: If a person subject to the penalty imposed under this section can show that the failure to file a return, pay the full amount of tax shown on the person's return, timely remit tax held in trust, or pay the deficiency determined by the department was due to reasonable cause and not due to willful neglect, the department shall waive the penalty. 45 IAC 15-11-2(b) states: "Negligence" on behalf of a taxpayer is defined as the failure to use such reasonable care, caution, or diligence as would be expected of an ordinary reasonable taxpayer. Negligence would result from a taxpayer's carelessness, thoughtlessness, disregard or inattention to duties placed upon the taxpayer by the Indiana Code or department regulations. Ignorance of the listed tax laws, rules and/or regulations is treated as negligence. Further, failure to read and follow instructions provided by the department is treated as negligence. Negligence shall be determined on a case by case basis according to the facts and circumstances of each taxpayer. Having reviewed the file and the reasons for the underpayment stated by the Taxpayer, the Department finds that under the circumstances described, Taxpayer was not negligent, as described within the regulation and statute. Taxpayer's actions were to due to reasonable cause and not due to willful neglect FINDING The taxpayer's penalty protest is sustained. Posted: 11/01/2006 by Legislative Services Agency DIN: 20061101-IR-045060467NRA Composed: Apr 28,2024 10:51:47AM EDT A PDF version of this document.