Source: http://www.in.gov/legislative/iac/20130130-IR-045130012NRA.xml.html
Timestamp: 2018-03-23 13:04:08
Document Index: 750357914

Matched Legal Cases: ['§ 6', '§ 6', '§ 6', '§ 6', '§ 6', '§ 6', '§ 6', '§ 6', '§ 6', '§ 6', '§ 6']

02-20120469P.LOF
Letters of Findings Number: 02-20120469P Corporate Income Tax For the Year 2009
I. Tax Administration – Ten Percent Penalty – Underpayment of Tax.
Authority: IC § 6-8.1-5-1; IC § 6-8.1-10-1; IC § 6-8.1-10-2.1; IC § 6-8.1-6-1; 45 IAC 15-11-2; Lafayette Square Amoco, Inc. v. Indiana Dep't of Revenue, 867 N.E.2d 289 (Ind. Tax Ct. 2007).
Taxpayer protests the imposition of the ten percent penalty for underpayment of tax, as well as interest.
Taxpayer is an out-of-state corporation doing business in Indiana. The Indiana Department of State Revenue ("Department") assessed Taxpayer a ten percent penalty for underpayment of tax by the original due date of Taxpayer's 2009 corporate income tax return. Taxpayer timely protested the assessment of penalty and interest. A hearing was held on Taxpayer's protest and this Letter of Findings ensues. Additional facts will be provided as needed.
The Department imposed a ten percent penalty and interest on Taxpayer because the Department found that Taxpayer – having filed a 2009 amended corporate income tax return adjusting its apportionment factor thus owing more tax – failed to remit ninety percent of the full amount of corporate income tax on or before the original due date for payment.
As a threshold issue, all tax assessments are prima facie evidence that the Department's claim for the unpaid tax is valid; the taxpayer bears the burden of proving that any assessment is incorrect. IC § 6-8.1-5-1(c); Lafayette Square Amoco, Inc. v. Indiana Dep't of Revenue, 867 N.E.2d 289, 292 (Ind. Tax Ct. 2007).
Under IC § 6-8.1-10-2.1, penalty waiver is permitted if the taxpayer shows that the failure to pay the full amount of the tax was due to reasonable cause and not due to willful neglect. IC § 6-8.1-10-2.1 further states in relevant part:
(e) A person who wishes to avoid the penalty imposed under this section must make an affirmative showing of all facts alleged as a reasonable cause for the person's failure to file the return, pay the amount of tax shown on the person's return, pay the deficiency, or timely remit tax held in trust, in a written statement containing a declaration that the statement is made under penalty of perjury. The statement must be filed with the return or payment within the time prescribed for protesting departmental assessments. A taxpayer may also avoid the penalty imposed under this section by obtaining a ruling from the department before the end of a particular tax period on the amount of tax due for that tax period.
The Department also notes that 45 IAC 15-11-2 further provides in relevant part:
The applicable statute is IC § 6-8.1-6-1, which provides in relevant part that:
(a) If a person responsible for filing a tax return is unable to file the return by the appropriate due date, he may petition the department, before that due date, for a filing extension. The person must include with the petition a payment of at least ninety percent (90[percent]) of the tax that is reasonably expected to be due on the due date. When the department receives the petition and the payment, the department shall grant the person a sixty (60) day extension.
(c) If the Internal Revenue Service allows a person an extension on his federal income tax return, the corresponding due dates for the person's Indiana income tax returns are automatically extended for the same period as the federal extension, plus thirty (30) days. However, the person must pay at least ninety percent (90[percent]) of the Indiana income tax that is reasonably expected to be due on the original due date by that due date, or he may be subject to the penalties imposed for failure to pay the tax.
Taxpayer has made an affirmative showing of reasonable cause for underpaying its estimated 2009 taxes. IC § 6-8.1-10-2.1, IC § 6-8.1-6-1 and 45 IAC 15-11-2. The assessment of the ten percent penalty is waived. However, pursuant to IC § 6-8.1-10-1(e), the Department cannot waive interest.
Taxpayer's protest of the imposition of penalty is sustained. However, Taxpayer's protest of the interest is denied.
DIN: 20130130-IR-045130012NRA
Composed: Mar 23,2018 9:04:07AM EDT