Tax Commission adopts clarified penalty-waiver rule to match standards for reasonable cause

The Utah State Tax Commission voted unanimously to adopt amendments to R861-1A-42, the rule governing waiver of penalty and interest for reasonable cause under Utah Code section 59-1-401. The amendment expands the allowable time frame for death or serious illness as a basis for a waiver and replaces prior language about seeking further advice with a requirement that the taxpayer exercised "reasonable care, prudence, and diligence in the matter that resulted in the imposition of the penalty or interest," clarifying that waivers are aimed at errors by advisers rather than taxpayer negligence.

Commissioners said the change harmonizes language with similar property-tax late-filing rules and provides clearer expectations for taxpayers seeking waivers. A commissioner who commented called the change a helpful clarification for taxpayers and practitioners. No members of the public requested to speak on this amendment before the motion was moved and approved by roll-call vote.