Taxpayer is an Indiana resident. As the result of an investigation, the Indiana Department of Revenue ("Department") determined that Taxpayer had purchased a recreational vehicle ("RV") in 2009 without paying sales tax in any state. The Department therefore issued a proposed assessment for use tax, penalty, and interest. Taxpayer protested the assessment and an administrative hearing was held. Letter of Findings ("LOF") 04-20120393 was issued denying the protest of use tax, primarily due to the lack of supporting documentation for Taxpayer's position, but sustaining Taxpayer's protest of negligence penalty. Taxpayer requested a rehearing and provided additional supporting documentation for the protest.
...
Taxpayer protests the imposition of use tax on the purchase of an RV in 2009. Taxpayer states that the RV was purchased in another state and that the RV never entered Indiana and that Indiana use tax is therefore not due. The Department notes that the burden of proving a proposed assessment wrong rests with the person against whom the proposed assessment is made, as provided by IC § 6-8.1-5-1(c).
...
Therefore, when tangible personal property is acquired in a retail transaction and is stored, used, or consumed in Indiana, Indiana use tax is due if sales tax has not been paid at the point of purchase. The Department determined that Taxpayer purchased the RV in Florida in a retail transaction on January 24, 2009, but did not pay Florida sales tax on the purchase. The Department therefore issued proposed assessments for Indiana use tax.
At the administrative hearing, Taxpayer was informed that supporting documentation would be required. Taxpayer did submit some documentation but it did not establish that the RV stayed outside Indiana. The LOF therefore denied the protest.
As part of the request for rehearing, Taxpayer was able to provide documentation which does establish that the RV did not enter Indiana. Since the RV did not enter Indiana, Taxpayer did not store, use, or otherwise consume the RV in Indiana. Since these things did not happen, Indiana use tax is not due. Taxpayer has met the burden imposed by IC § 6-8.1-5-1(c).
