In 1996, the Taxpayer worked as an independent contractor providing home health care services. She was not aware that New Mexico gross receipts tax was due on her income. After receiving information from the Internal Revenue Service concerning business income on the Taxpayer’s 1996 federal income tax return, the Department assessed the Taxpayer for gross receipts tax, penalty and interest. The Taxpayer protested only the penalty and interest portion of the assessment, arguing 1) the Department waited too long to notify her of liability for gross receipts tax; 2) she relied on the advice of her accountant; and 3) she was physically and mentally exhausted by the need to provide 24-hour-a-day care for her fiancé. Held: The Taxpayer was not negligent in failing to report gross receipts tax during the period at issue, however, she was late in paying gross receipt taxes due to the state, and interest was properly assessed pursuant to Section 7-1-67 NMSA 1978. Protest granted in part and denied in part.
Julia M. Santos (Griswold)