Current through August 31, 2023
Section
63-3046(a), Idaho
Code
01.
Negligence
Defined. Negligence is the breach of a duty or obligation, recognized by
law, that requires conformance to a certain standard of conduct.
(3-15-22)
02.
Imposition of
Penalty. A five percent (5%) negligence penalty shall be imposed if the
deficiency results from either negligence by the taxpayer or from disregard by
the taxpayer or his agent of state or federal tax laws, rules of the Tax
Commission, or Treasury Regulations. Situations that justify the penalty
include but aren't limited to the following: (3-15-22)
a. Taxpayer continues to make errors in
reporting income, sales or assets, or claims erroneous deductions, exemptions,
or credits even though these mistakes have been called to his attention in
previous audit reports. (3-15-22)
b. Taxpayer fails to maintain proper records
and files returns containing unsubstantiated claims or substantial errors.
(3-15-22)
c. Taxpayer makes
unsubstantiated or exaggerated claims of deductions or exemptions.
(3-15-22)
d. Taxpayer fails to
offer any explanation for understating taxes. (3-15-22)
e. Unreported taxable income is a material
amount as compared with the reported income. (3-15-22)
f. Taxpayer exhibits a careless disregard of
his tax obligations. (3-15-22)
g.
For sales or use tax deficiencies, failure to keep valid files of resale and
exemption certificates. (3-15-22)
h. Failure to make the required estimated
payment when requesting an extension of time for filing a return.
(3-15-22)
i. Taxpayer fails to
provide the Tax Commission with a copy of a final federal determination
according to Section
63-3069, Idaho Code.
(4-6-23)
j. Taxpayer fails to file
an Idaho amended return according to Section
63-3069, Idaho Code.
(4-6-23)
k. Taxpayer fails to
respond to requests to produce records substantiating items shown on the
return. (3-15-22)
l. Taxpayer fails
to make available the fifty-one (51) state apportionment factor detail when
requested. (3-15-22)
03.
Negligence Penalty for Sales and Use Tax Deficiencies. For sales
tax purposes, pertinent computations relating to substantial errors in
Subsection 410.02.b. or material amount
in Subsection 410.02.e., might include the
following: (3-15-22)
a. The ratio of untaxed
sales that should have been taxed to total taxable sales; (3-15-22)
b. The ratio of untaxed sales that should
have been taxed to total sales; (3-15-22)
c. The ratio of untaxed purchases subject to
use tax to total taxable purchases and to total purchases; or
(3-15-22)
d. Other computations
bearing on negligence. (3-15-22)
04.
Waiver of Negligence
Penalty. The Tax Commission shall consider all factors when determining
whether to waive a negligence penalty. One (1) factor is the taxpayer's record
for filing and paying state taxes. A good record for filing and paying tax on
returns filed annually is not by itself a sufficient reason to waive the
penalty. (3-15-22)
05.
Circumstances Precluding Waiver of Penalty. The following
circumstances do not constitute sufficient cause to waive the penalty:
(3-15-22)
a. An invalid or unapproved request
for an extension of time to file or to do acts required by Idaho tax laws;
(3-15-22)
b. An unsettled dispute
between the Tax Commission and the taxpayer concerning a tax liability; or
(3-15-22)
c. Inability to pay the
tax. (3-15-22)
