Jackson Rock Springs Stages

20-09

On August 13, 2019, the Department issued an assessment to the Taxpayer for weight distance tax, late payment penalty and interest, and an additional weight distance penalty for not reporting mileage in New Mexico. On August 27, 2019, the Taxpayer protested the assessment. Though the Taxpayer conceded that it owed the tax, late penalty and interest, it contested the additional weight distance penalty. The Taxpayer owns tour buses and provides transportation for its customers in New Mexico. Though the Taxpayer was registered with the federal International Fuel Tax Agreement (IFTA) program, it was not registered with the New Mexico weight distance tax program and said that it believed this was sufficient for paying all taxes owed to New Mexico. The Taxpayer had made some payments for weight distance tax at New Mexico ports of entry but the total payments were less than the total tax owed based on its New Mexico mileage reported to IFTA. Though the Taxpayer recognized that it owed the weight distance tax, it argued that the assessment was beyond the statute of limitation and that the addition weight distance tax penalty was excessive. In many circumstances the statute states that the Department may only assess a Taxpayer three years from the end of the calendar year in which the tax is due. However, when a Taxpayer fails to file a return the Department has seven years to assess from the end of the calendar year in which the tax is due. In this case the Taxpayer had not filed any returns from 2012 through 2017, so the assessment in 2019 was within the statute of limitations. The weight distance penalty is calculated by the quarterly filing period for weight distance tax and is only applied when the Department conducts an audit. The penalty in this case was for an amount greater than the other tax, penalty and interest combined, however the statute is clear that penalty must be applied to each quarter based on the amount of tax owed. Though the Hearing Officer was sympathetic with the Taxpayer’s dismay over the penalty amount, the statute states clearly what the penalty amount is to be in this instance and that it is mandatory. The Hearing Officer determined there was no authority to overturn the statute assessing the penalty. This having been decided, the protest was denied.