Form St 07-25 - Sales Tax - 2007 Page 11
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11for 10 transactions where the trade-in deduction was disallowed. These documents are
not consistent, probable and indicative of actions that reflect the Taxpayer was not wilfull
in his failure to perform his tax obligations. To the contrary, these documents either
failed to address the issue of wilfull failure (Taxpayer Ex. Nos. 1-6) or reaffirmed that
Taxpayer did, in fact, wilfully fail in his tax obligations (Taxpayer Ex. Nos. 7-18).
Because Taxpayer abdicated and/or delegated the responsibility for the proper treatment
and accounting of trade-in deductions without a proper inspection and review of the
556’s, he failed to keep himself informed of the status of his Corporation’s tax
compliance, and as such, wilfully failed to properly account for trade-ins.
As previously noted, the Department's prima facie case was established in this
case when the Department's certified record relating to the penalty liability was admitted
into evidence. Taxpayer then had the burden of establishing that one or more of the
elements of the penalty were lacking. Taxpayer concedes the responsible officer element
and has not established that he was not wilfull in discerning when trade-ins were to be
taken as deductions. In fact, the evidence reflects that Taxpayer wilfully failed to
perform his duties because he ought to have known that there was a grave risk that the
taxes were not being correctly accounted for and he was in a position to find out for
certain very easily. See Wright, supra.
RECOMMENDATION:
Inasmuch as Taxpayer did not present sufficient evidence to overcome the
Department’s prima facie case, it is recommended that the Notice of Penalty Liability be
upheld in total.
0Julie-April Montgomery
Administrative Law Judge
Enter: December 3, 2007
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