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1994-2 N.Y. Tax Cas. J-289 (1994)

handle is hein.nytax/nytcas0024 and id is 1 raw text is: 1994 New York Tax Cases J-289 basis from that point forward. Neither Mr. Guarre nor any other of petitioner's employees sought, at any time, to confirm this interpretation of the memorandum. 9. In accordance with Mr. Guarre's interpretation of the memorandum, petitioner ceased filing sales tax returns effective the quarter ended November 30, 1979. Subsequent to that time, petitioner mailed to its parent's Eastern Regional Office monthly summary sheets with respect to petitioner's motor shop and service department which listed job-by-job breakdowns of petitioner's material and labor costs, amounts billed to customers, and sales tax charged and collected. 10. Mr. Guarre's interpretation of the memorandum from Mr. D'Elia was incorrect. The memorandum was intended to pertain to consolidated income tax filings and was not intended to pertain to sales tax filings. However, there was no communication between petitioner and its parent on the subject of sales taxes subsequent to the November 1979 memorandum. Consequently, sales tax returns were not filed on petitioner's behalf during the audit period. 11. Petitioner's interpretation of the memorandum and its misunderstanding that its parent would file sales tax returns on its behalf continued unabated until the commencement of the audit herein in 1988. 12. As a result of its failure to file sales tax returns subsequent to November 30, 1979, petitioner, who had previously been a registered vendor for sales tax purposes, became unregistered by reason of a Division computer program which rescinds the registration of vendors who fail to file returns for four consecutive quarters. 13. Throughout the period at issue, Fischbach and Moore sporadically charged an account in petitioner's general ledger for taxes paid on petitioner's behalf. Fischbach and Moore provided no details to petitioner with respect to these charges and petitioner made no requests to its parent for any details as to the composition of such charges. Mr. Guarre believed that such charges to the general ledger included sales tax payments made by Fischbach and Moore on petitioner's behalf. 14. On February 8, 1993 and March 4, 1993, respectively, petitioners' representative and the Division's representative executed stipulations pursuant to which the parties consented to the assessment of additional tax due against each petitioner herein in the amount of $170,888.51. 21t should be noted that although such stipulations were not formally offered into evidence at the hearing, reference was made to such stipulations on the record. Executed originals of the stipulations were submitted to the Division of Tax Appeals prior to the hearing. Accordingly, such consents are hereby formally made part of the record herein. It should be further noted that since petitioner has stipulated to the amount of the tax deficiency, this determination shall not delve into the details of the audit methodology.

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