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Bridgestone/Firestone Research, Inc. v. Director, Division of Taxation

A-3880-06T1 (N.J. Super. App. Div. 2008) (Unpublished)

TAXATION; APPEALS; NOTICES — A taxpayer’s argument that it never received an oral notice until after the ninety day tax appeal period has expired can be contradicted by evidence that it submitted tax returns requested by the taxing authority and, a company’s equitable argument for an extension of the ninety period is defeated by the taxpayer refusing to enter into an extension agreement even if doing so would have waived its right to file an appeal.

The New Jersey Division of Taxation sent a letter to an out of state company that conducted business in New Jersey. It informed the company that it was being audited for the prior four business years and that it was required to provide the tax returns for those years plus additional information. The company did not respond and after two successive attempts which were sent to a new address, the company sent the Division the requested returns with no additional information or correspondence. One week after the tax returns were received, the Division notified the company that back taxes were due and that the assessed amount was levied because the company did not provide the additionally requested information. The notice also stated that the amount was to be deemed correct unless the company requested a hearing within ninety days. The company did not request a hearing within the ninety day period and a Certificate of Debt was issued. The company then contacted the Division and offered to provide the requested information, but the Division refused unless the company signed an agreement waiving its right to appeal any revised assessment.

The company would not sign the agreement and instead filed an appeal in Tax Court which dismissed the action. On further appeal, the company argued that it did not respond to the notice of assessment within the ninety-day period because it had difficulties with the new mailing address and because notice should have been sent to the attention of its tax department. The Appellate Division questioned the company’s argument that it never received notice of the audit until after the ninety-day period because it responded with the requested tax returns. It pointed out that the company could have avoided any additional tax liability if it had entered into the agreement waiving an appeal. Thus, the Tax Court’s dismissal of the company’s action was affirmed.

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