Donna C. Marchak



The taxpayer claimed an extra exemption on her 1999 New Mexico personal income tax return, resulting in her receipt of an erroneous refund in the amount of $170.  In 2003, based on information received from the Internal Revenue Service, the Department discovered the error and assessed the taxpayer for $170 of tax principal, plus penalty and interest.  The taxpayer protested the assessment of interest, arguing that interest should not begin to accrue until the date the Department notified her of the error on her 1999 return.  The protest was denied because, pursuant to Section 7-1-67(A) NMSA 1978, taxpayers are liable for interest on tax underpayments from the first day following the day on which the tax is due until the date the tax is paid.?