Chamisa Hills Family Dental

18-04

On August 17, 2017, the Department assessed the Taxpayer for gross receipts tax, withholding tax, penalty, and interest. On August 23, 2017, the Taxpayer submitted a formal timely protest with the Department. In May of 2016, the Taxpayer purchased the business from the prior owner. Based on the prior owner’s high recommendation, the office manager stayed working at the business after the change of ownership. In or around May of 2017, the Taxpayer noticed that certain duties assigned to the office manager where not being completed. Among those duties were the Taxpayer’s CRS-1 returns. Upon the resignation of the office manager the Taxpayers filed all late CRS-1 returns. The Taxpayer is asking for an abatement of penalty and interest based on the circumstances surrounding the prior employee. The Department argued that multiple notices were sent to notify the Taxpayer that they were not filing returns and that there was an underpayment of tax due. Based on that underpayment, penalty and interest were calculated and assessed. The Hearing Officer determined that based on the information and Sections 7-1-67 NMSA 1978 and Section 7-1-69 NMSA 1978 the assessment of penalty and interest were properly assessed by the Department. The Taxpayer failed to establish non-negligence so penalty cannot be abated and interest cannot be abated per statute. For the forgoing reasons, the Taxpayer’s protest is denied.