Ariz. Admin. Code § 15-5-2217

Current through Register Vol. 30, No. 24, June 14, 2024

Section R15-5-2217 - Reasonable Cause for Waiver of Civil Penalties

A. Pursuant to A.R.S. 42-1125, the Department shall not apply specified civil penalties for failure to pay a required amount of transaction privilege tax or file a required transaction privilege return if reasonable cause exists and the failure to pay was not due to willful neglect or fraud. Generally, reasonable cause exists whenever a taxpayer uses prudent and timely business practices but nonetheless fails to fully comply with its tax remittance and reporting requirements due to circumstances beyond the taxpayer's control.

B. The Department must consider a taxpayer requesting waiver of civil penalties to have reasonable cause if a failure to pay transaction privilege tax due or file a required transaction privilege tax return was due to a system outage or other system unavailability- whether scheduled or unscheduled-of AZTaxes.gov that prevents or substantially interferes with a taxpayer's ability to access, submit, or otherwise complete a required return or payment and submit the return or payment in the time required by law.

C. The Department must consider a taxpayer requesting waiver of civil penalties to have reasonable cause if a failure to pay the full and correct amount of transaction privilege tax due or file a complete and correct transaction privilege tax return was due to a software- or application-based error by either AZTaxes.gov or a Department-approved vendor's software to calculate and file a transaction privilege tax return, if the error demonstrably results in the incorrect calculation or payment of any taxes due.

D. Except as provided in subsection (E), a taxpayer requesting waiver of civil penalties for reasonable cause shall notify the Department of the issue or error in writing within a reasonable time after becoming aware of the issue or error.

E. The Department may waive civil penalties without requiring a written taxpayer request for any system outage, system unavailability, or other event or anomaly as described in subsections (B) and (C) if it becomes aware of the event or anomaly before issuing a penalty assessment.

Ariz. Admin. Code § R15-5-2217

Repealed effective September 24, 1986 (Supp. 86-5). Adopted by exempt rulemaking at 25 A.A.R. 3010, effective 10/1/2019.