Taxpayer is a business with operations in Indiana. The Indiana Department of Revenue ("Department") determined that Taxpayer had not timely remitted its income tax for the tax year 2009. Taxpayer had filed for a filing extension for its 2009 income tax.
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The Department issued proposed assessment for penalty on failure to timely remit income tax for 2009. Taxpayer protests that it had previously had sufficient net operating losses to result in no income tax due, but that in the course of preparing its 2009 income tax return it determined that it did owe Indiana income tax for that year. Taxpayer states that this was its first incidence of owing income tax and that it is now aware that it may owe Indiana income. Taxpayer also states that it has taken steps to ensure that it makes adequate and timely withholdings regarding its income tax obligations. Taxpayer protests the imposition of penalty and requests a waiver of that penalty.
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The Department considered Taxpayer's failure to remit income tax by the original filing deadline to constitute negligence and so imposed penalty under IC § 6-8.1-10-2.1(a). As a result of the protest process, Taxpayer has affirmatively established that it acted reasonably in its efforts to comply with Indiana's tax filing requirements, as required by 45 IAC 15-11-2 (c). The penalty will be waived. However, the Department takes this opportunity to notify Taxpayer that it is now aware of its income tax obligations and that penalty may be imposed if this scenario occurs again.
