Form St 07-25 - Sales Tax - 2007 Page 10
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11Taxpayer was in a business that had significant tax responsibilities and numerous
transactions. Each transaction had serious tax consequences – to tax or not to tax various
aspects of the transaction, like a trade-in.
Taxpayer admits he made erroneous
assumptions about a crucial element of the Corporation’s regular transactions – the trade-
in. Taxpayer alleges ignorance of how to account for trade-ins, but ignorance of the law
is no excuse for failure to properly account for one’s tax obligations.
DuMont
rd
Ventilation Company v. Department of Revenue, 99 Ill. App. 3d 263 (3
Dist. 1981).
Taxpayer failed to seek professional advice, from either his CPA or the Department. He
chose to rely upon others outside of his business for limited assistance that did not even
address the issue of how to properly account for trade-ins. Moreover, Taxpayer did not
seek to inquire whether his own staff properly accounted for or could explain to him how
and why they recorded trade-ins on the 556’s the way they did. In light of Taxpayer’s
failure to seek advice, professional or otherwise, to claim ignorance because no one told
Taxpayer what he should have ascertained on his own is disingenuous.
Taxpayer’s arguments imply that he delegated responsibility for the proper
completion of the 556’s to his staff. But Illinois law holds responsible officers, like
Taxpayer, liable for wilfull failure to account for and remit taxes if they delegate
responsibility but fail to inspect business records, like the 556’s, or otherwise fail to keep
themselves informed of the status of their tax obligations. Branson, supra at 427.
Abdication of one’s tax obligations in favor of others, like salesmen, clerks and
receptionists, is not acceptable in a responsible person, like Taxpayer. Wright, supra at
427.
The exhibits presented by Taxpayer consisted of Department work papers that
reflected the basis for the liability; documents which reflected the Corporation’s final
federal tax return, final Department assessment and the conduct of the administrative
hearing for such assessment; 556’s and accompanying paper work for 2 transactions
where the trade-in deduction was allowed; and 556’s and the accompanying paper work
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