The Issue Whether factual and legal grounds support the Department of Revenue’s jeopardy findings and assessment, dated May 26, 2017.
Findings Of Fact Parties and People The Department is the state agency responsible for implementing and administering the revenue laws of the State of Florida, including the laws relating to the imposition and collection of the state’s sales and use tax, pursuant to chapter 212, Florida Statutes. VMOB is a Florida limited liability company with its principal address at 317 South Howard Avenue, Tampa, Florida 33606; and its mailing address and tax registration address as Post Office Box 342681, Tampa, Florida 33694. For the purposes of these proceedings VMOB is the taxpayer. Verna Bartlett is, and has been since its inception, VMOB’s managing member responsible for collecting and remitting VMOB's sales and use tax. Lewis Mustard became VMOB’s Power of Attorney (POA) in October of 2016. Notice to VMOB Pursuant to the Department’s “Power of Attorney and Declaration of Representative” form submitted by VMOB (POA form), receipt of notices or other written communications “by either the representative or the taxpayer will be considered receipt by both.” The POA form further provides that “[c]ertain computer- generated notices and other written communications cannot be issued in duplicate due to certain system constraints. Therefore, [the Department] will send these communications to only the taxpayer at his or her tax registration address.” The notices of the Jeopardy Finding and Final Assessment in this case were mailed together to VMOB’s mailing address via certified mail and regular USPS mail. The certified mailing was returned unclaimed; the regular USPS mailing was not returned. Ms. Bartlett acknowledged receiving the notices and eventually brought this protest. The undersigned finds VMOB received notice of the Jeopardy Finding and Assessment. VMOB’s Electronic Filings Beginning January 2016, VMOB was required to file and pay its sales tax electronically, unless it received a waiver. See § 213.755(1), Fla. Stat.; Fla. Admin. Code R. 12-24.003. The Department established at the hearing that it repeatedly made VMOB aware of the electronic filing requirement. For example, each tax bill sent to VMOB indicated payment was to be made electronically; and Department staff explained the electronic filing and payment requirements to Ms. Bartlett on August 18, 2015. On April 29, 2016, the Department sent a fax to Ms. Bartlett, which included a reminder of the electronic filing and payment requirement. In response, Ms. Bartlett stated, “I will begin filing electronically with the May [2016] sales tax return.” On December 29, 2016, the Department also notified VMOB’s POA of the electronic filing and payment requirement. Ms. Bartlett believed that as long as she paid a penalty, she did not have to file tax returns or tax payments electronically. However, there was insufficient evidence to support this belief. The undersigned finds VMOB has never filed or paid its sales tax electronically. VMOB’s Tax Jeopardy VMOB issued worthless checks for sales tax due for the periods of June 2016, July 2016, and September 2016 through February 2017. As of May 26, 2017, the date of the Jeopardy Finding, the dishonored checks for these time periods had not been satisfied, and VMOB had an outstanding tax liability totaling $104,853.60. VMOB’s April 2017 sales tax payment was due no later than May 20, 2017. See § 212.15(1), Fla. Stat. The April 2017 payment had not been received by the Department as of May 26, 2017. The competent and credible evidence establishes that as of May 26, 2017, payment of the March 2017 and April 2017 sales tax was jeopardized by delay. Payment of VMOB’s sales tax remains in jeopardy given that VMOB has yet to submit payment requirements through electronic filing, and as of the date of the hearing, these liabilities were still outstanding. As a result, the undersigned finds the Department properly issued the Jeopardy Finding. VMOB’s Tax Liability The sales tax reporting periods at issue in the Jeopardy Findings and Assessment are March 2017 and April 2017. The total tax due for the March 2017 reporting period, as reflected on VMOB’s sales tax return and as reflected on the Assessment, is $6,668.73. The total tax due for the April 2017 reporting period, as established at the hearing, is $5,651.75.2/ VMOB issued check number 40552 in the amount of $6,668.73 from a Suntrust Bank account on April 20, 2017. VMOB issued check number 40553 in the amount of $5,651.75 from a Suntrust Bank account on May 22, 2017. Both of these checks (for VMOB’s March and April 2017 sales tax payments) were dishonored by Suntrust Bank with the notation “Return Reason – Unable to Locate Account.” Ms. Bartlett contends she was unaware worthless checks were being issued for the June 2016 through April 2017 periods until late May or early June of 2017. Given the undisputed evidence regarding the efforts by the Department to obtain payment, this contention is implausible. For example, for each returned check (June 2016, July 2016, September 2016 through February 2017, March 2017 and April 2017), the Department automatically mailed out a bill to VMOB at its mailing address. There was no evidence VMOB did not receive these bills. On November 28, 2016, the Department explained to VMOB’s POA that VMOB was writing worthless checks to the Department. On December 28, 2016, the Department informed VMOB’s POA that Ms. Bartlett continued to pay with worthless checks. Even if it is true that Ms. Bartlett was not aware of the worthless checks being used to pay VMOB’s taxes, any lack of knowledge was due to her own misfeasance. Ms. Bartlett admits that from October 2016 through April 2017, she did not have adequate oversight over or involvement with VMOB. She did not monitor its checking accounts or finances; she left pre-signed blank checks for her staff, and she did not ask staff for an accounting. Ms. Bartlett’s testimony is further undermined by her own correspondence to the Department, dated January 30 and February 27, 2017, in which Ms. Bartlett acknowledges notices of assessment of personal liability and personal jeopardy. She, therefore, had to be aware at that point there was a problem with VMOB’s banking accounts and the methods of paying its tax liabilities. Even after Ms. Bartlett discovered the checks used to make the March and April 2017 tax payments had not been honored by the bank, VMOB made no efforts to pay the tax liability amount.
Recommendation Based on the foregoing Findings of Facts and Conclusions of Law, it is RECOMMENDED that the Department of Revenue enter a final order: (1) Sustaining the May 26, 2017, Notice of Jeopardy Finding; and (2) Issuing an Assessment for March and April 2017 in the amount of $12,320.48 with penalties and interest. DONE AND ENTERED this 22nd day of May, 2019, in Tallahassee, Leon County, Florida. S HETAL DESAI Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 22nd day of May, 2019.
The Issue The issue in this case is whether Respondent's assessment of sales tax against Petitioner pursuant to Section 212.0505, Florida Statutes, should be upheld.
Findings Of Fact Based upon the oral and documentary evidence adduced at the final hearing and the entire record in this proceeding, the following findings of fact are made: By Notice of Assessment and Jeopardy Findings dated October 15, 1990 (the "Assessment"), Respondent, Department of Revenue (Department), determined that taxes imposed under Section 212.0505, Florida Statutes, were due from Petitioner, Jose A. Espino, for the unlawful sale, use, consumption, distribution, manufacture, derivation, production, transportation or storage of a controlled substance, to wit: cocaine. Specifically, the notice provided Petitioner with a "Notice of Assessment of tax, penalty, and interest on the deficiency" as follows: Date of Transaction or Incident (On or About) August 22, 1990 Estimated Retail Price 2 Kilo Cocaine $25,000.00 25% Surcharge [s.212.0505(1)(a), F.S.] $12,500.00 25% Surcharge [s.212.0505(1)(b), F.S.] $ 6,250.00 Penalty of 5% per month, maximum of 25% of Tax and Surcharge Due [s.212.12(2), F.S.] $ 937.50 Additional Penalty of 50% [s.212.12(2), F.S.] $ 0 Interest of 1% per month [s.212.12(3), F.S.], accrues at the rate of $6.16 per day. INTEREST computed thru 9/21/90 $ 49.28 Total Amount Due with this Notice $19,736.78 The factual basis for the Assessment was Petitioner's involvement in the transactions described in Findings of Fact 4-9 below. Petitioner filed a timely Petition to Challenge the Notice of Assessment and Jeopardy Findings. The only basis for the challenge set forth in the Petition was a contention that Petitioner was not engaged in the unlawful transportation of cocaine and that Section 212.0505, Florida Statutes was not applicable under the facts and circumstances of this case. During discovery and at the formal hearing in this case, Petitioner also challenged the estimated retail price used by Respondent in making the calculations set forth in the Assessment. Petitioner has not contested the mathematical accuracy of the Assessment nor has Petitioner contested the form of the Assessment or presented any evidence that the procedures for issuing the Assessment were improper. No evidence was presented that Petitioner has paid the sales tax assessed by Respondent or that the sales tax assessed has been paid by another individual on his behalf. In August of 1990, Petitioner, Jose A. Espino, was the owner of a paint and body shop located at 12524 S.W. 128th Street, Miami, Florida. Petitioner was present at the paint and body shop on August 22, 1990. On this date, he had agreed to meet with an individual who was working as a confidential informant for the Metro-Dade Police Department. Petitioner had previously negotiated with this confidential informant to sell four (4) kilos of cocaine at $30,000 per kilo. On August 22, 1990, Jerry Hull, a senior narcotics detective with the Metro-Dade Police Department, and the confidential informant drove to Petitioner's place of business. Detective Hull was seated on the passenger side of the front seat and observed the Petitioner coming out of the building carrying a maroon utility bag. Petitioner approached the vehicle occupied by Detective Hull and the confidential informant. Detective Hull got out of the vehicle and allowed Petitioner to get into the front seat. Detective Hull got into the back seat and the confidential informant drove the car east on S.W. 128th Street. As the confidential informant drove the vehicle, Detective Hull introduced himself to Petitioner and asked if he "brought the merchandise..." Petitioner stated that he had and inquired if Hull had the money. By his statements, Petitioner acknowledged his readiness to sell the cocaine he brought into the van. After inquiring about the money, Petitioner opened the utility bag he had carried into the van and showed Detective Hull a package. Petitioner gave the package to Hull and opened a cut previously made in the wrapping exposing a white substance inside. Detective Hull asked Petitioner for a sample. Based on his experience, Detective Hull identified the substance in the package as cocaine. Petitioner has, by virtue of the Respondent's Request for Admissions, admitted the substance he was carrying was cocaine. Petitioner told Detective Hull he had two (2) kilograms of cocaine in the bag. The Request for Admissions confirm that Petitioner carried two (2) kilograms of cocaine into the vehicle. Shortly after Petitioner showed Detective Hull the cocaine, a police car pulled up behind the van driven by the confidential informant. The police stopped the van and Petitioner was arrested and charged with trafficking in cocaine. No evidence was presented as to the disposition of the criminal charges. A copy of the police arrest report was forwarded to the Department of Revenue. As noted above, the Department of Revenue issued the Notice of Assessment and Jeopardy Findings on October 15, 1990. This Assessment was issued based upon the information contained in the Metro-Dade Police arrest report. As set forth above, the Assessment was issued in the amount of $19,736.78. The estimated retail price used by the Department of Revenue in calculating the tax due was $12,500 per kilogram. This estimate of retail price was derived from a price list compiled by the Florida Department of Law Enforcement (FDLE). The price appearing in the FDLE report is based upon average prices for various types of illegal narcotics sold throughout Florida. The FDLE price list used by DOR in preparing the Assessment is segregated by the type of drug and by various regions of the state. The price used in this Assessment was based upon the FDLE report compiled from information available as of June 7, 1989 for the Miami region. This region included Dade, Broward and Palm Beach counties and included prices for transactions involving the sale of one (1) kilo or more of cocaine. Thus, the report reflects the economic fact that larger quantity purchases occur at relatively lower prices. The price of cocaine rose sharply between 1989 and 1990. A subsequent update of the FDLE report utilizing information available as of August 1, 1990, revealed prices in the Miami region rose to $22,000 for kilogram size sales of cocaine. Thus, it appears the price used in the Assessment in this case is significantly lower than either the anticipated sales price of the parties ($30,000 per kilo) or the price reported by the FDLE in its later report (August 1, 1990). If anything, the Assessment was based on a conservative estimate of actual retail prices in the Miami area at the time. Petitioner has not provided any persuasive evidence to show the Department of Revenue's estimated price of $12,500 per kilo is inappropriate. Interest on the Assessment continues to accrue at the rate of $6.16 per day since September 28, 1990.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Revenue issue a Final Order in this case concluding that the Petitioner, Jose A. Espino, is liable for taxes, penalties, and interest pursuant to Section 212.0505, Florida Statutes (1989), and assessing the amount of such liability at $19,736.78, plus interest at the rate of $6.11 per day since September 28, 1990. DONE and ENTERED this 31st day of July, 1992, at Tallahassee, Florida. J. STEPHEN MENTON Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 31st day of July, 1992. APPENDIX Both parties have submitted Proposed Recommended Orders. The following constitutes my rulings on the proposed findings of fact submitted by the parties. The Petitioner's Proposed Findings of Fact Proposed Finding Paragraph Number in the Findings of Fact of Fact Number in the Recommended Order Where Accepted or Reason for Rejection. Adopted in substance in Findings of Fact 3 and in the Preliminary Statement. Rejected as constituting legal argument. While the Petition in this case did not challenge the mathematical accuracy of the tax assessment, Petitioner asserted in discovery and at the formal hearing that the estimated retail value utilized by Respondent in making the Assessment was not accurate. This suggestion is rejected. As set forth in Findings of Fact 12 and 13 and Conclusions of Law 12, the estimated retail value utilized by Respondent in this case was reasonable. Rejected as vague and constituting legal argument rather than a Finding of Fact. Subordinate to Findings of Fact 12 and 13. Subordinate to Findings of Fact 5 and addressed in Conclusions of Law 10. The Respondent's Proposed Findings of Fact Proposed Finding Paragraph Number in the Findings of Fact of Fact Number in the Recommended Order Where Accepted or Reason for Rejection. Adopted in substance in the Preliminary Statement. Adopted in substance in Findings of Fact 3. Adopted in substance in Findings of Fact 3. Adopted in substance in Findings of Fact 3. Addressed in the Preliminary Statement. 6. Adopted in substance in Findings of Fact 4. 7. Adopted in substance in Findings of Fact 5. 8. Adopted in substance in Findings of Fact 5. 9. Adopted in substance in Findings of Fact 6. 10. Adopted in substance in Findings of Fact 7. 11. Adopted in substance in Findings of Fact 8. 12. Adopted in substance in Findings of Fact 9. 13. Adopted in substance in Findings of Fact 10. 14. Adopted in substance in Findings of Fact 11. 15. Adopted in substance in Findings of Fact 12. 16. Adopted in substance in Findings of Fact 13. COPIES FURNISHED: Vicki Weber, General Counsel Department of Revenue 204 Carlton Building Tallahassee, Florida 32399 Thomas Herndon, Executive Director Department of Revenue 104 Carlton Building Tallahassee, Florida 32399-0100 Angel M. Gonzalez, Esquire 28 W. Flagler Street Suite 806 Miami, Florida 33130 James McAuley Assistant Attorney General Tax Section, Capitol Building Tallahassee, Florida 32399-1550
Findings Of Fact During the month of September 1988, petitioner, David J. Caplan, agreed with, unbeknownst to him, a special agent with the Drug Enforcement Administration to secure and deliver to the agent 12 kilograms of cocaine for $16,500 per kilogram (kilo). On September 27, 1988, petitioner picked up one kilo of cocaine from his supplier and transported it in his vehicle to his residence. Within his residence, petitioner met with the agent and a confidential informant (CI), and delivered the one kilo of cocaine to the agent in exchange for $16,500. On September 28, 1988, following negotiations regarding the purchase of the balance of the cocaine, petitioner picked up two kilos of cocaine from his supplier, transported it by truck to his residence, and hid it in a garbage can adjacent to his garage. Upon the arrival of the agent and CI, petitioner removed the cocaine from the garbage can, and displayed it to the agent inside his residence. After examining the cocaine, the agent and CI left the residence under the announced intention of going to get the money for the purchase of the two kilos, and once away from the residence the agent gave the signal to other agents for petitioner's arrest. Upon arrest, petitioner cooperated with the agents, and directed them to the two kilos of cocaine, which he had hidden in the rafters of his garage. 1/ Subsequently, petitioner was charged and pled guilty to trafficking in cocaine. On February 21, 1990, respondent, Department of Revenue (Department), issued a Notice of Assessment and Jeopardy Findings which assessed a tax of $9,900, a penalty of $2,475, an additional penalty of $4,950, and interest of $1,589.25, together with interest thereon at the rate of $3.25 per day after February 21, 1990, against petitioner, pursuant to Section 212.0505, Florida Statutes. At petitioner's request, the Department reconsidered such assessment, and on May 7, 1991, issued a revised assessment against petitioner, assessing a tax of $9,900, a penalty of $2,475, and interest of $1,589.25, together with interest at the rate of $3.25 per day after February 21, 1990. The factual basis for the assessment was the petitioner's involvement in the cocaine transactions described in the foregoing findings of fact. Petitioner filed a timely petition seeking a formal hearing to contest the Department's assessment. At hearing, petitioner contended that the cocaine in question was not his, that he merely acted as a go-between for the agent and his supplier, and that he was therefore not involved in any sale, use or distribution of the subject cocaine. Moreover, with regard to the second transaction, which involved the two kilos of cocaine, petitioner contended that no liability for any tax could attach because the sale was not consummated, i.e.: petitioner had not yet actually exchanged the cocaine with the agent for the agreed purchase price. Petitioner's contentions regarding the limited nature of his involvement is contrary to the credible proof, and petitioner's contentions regarding the implications of that participation are contrary to the law, discussed infra. Succinctly, petitioner actively participated in the transportation, storage, distribution and sale of the cocaine, and he is subject to the implications of such activity under the provisions of Section 212.0505, Florida Statutes. Notwithstanding his active participation in the sale of the cocaine, petitioner averred at hearing that such participation was not voluntary. Rather, petitioner contended that his participation resulted from pressure asserted by a friend of long standing (Lupo) who, unbeknown to him, had become a confidential informant. 2/ According to petitioner, Lupo pressured him into locating a supplier of cocaine for the agent and CI involved in the subject transactions, as a consequence of hounding him for an old $1,600 debt petitioner had incurred for purchasing cocaine at a time he was addicted to the drug, and by an oblique remark the confidential informant made that "he knew my kid played outside," which petitioner averred he interpreted to be a threat to do something to his son. Petitioner's contention that his participation in the subject transactions was not voluntary or, stated differently, that he was entrapped, is rejected as contrary to the more credible proof. Here, the proof demonstrates that petitioner's motivation was financial and that he had a familiar relationship of long standing with Lupo and his ultimate supplier (Greenburg) which, coupled with the lack of sincerity and precision to his testimony, make his protestations of duress ring hollow. Regarding his financial motivation, the proof demonstrates that when approached by Lupo, petitioner was financially strapped, and stood to make $500 for each kilo he could deliver. Had the entire transaction been consummated for the agreed 12 kilos, petitioner stood to make a quick $6,000. Regarding the relationships that existed, the proof demonstrates that petitioner had been friends with Lupo and Greenberg for over twenty years, had actually lived with Greenberg for ten years, and that there was no apparent change in that relationship when he was approached by Lupo and introduced to the agent in this case. Considering the length of their relationship, and the lack of conviction in petitioner's testimony, it is concluded that petitioner's participation in this transaction was not compelled by any threat from Lupo, but by his own financial needs. In sum, the proof supports the conclusion that petitioner did engage in the unlawful sale, use, distribution, transportation or storage of cocaine as set forth in the Notice of Assessment and Jeopardy Findings, and that the Department's assessment of tax, penalty and interest set forth in its revised assessment was reasonable and appropriate.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that the Department issue a final order concluding that petitioner, David J. Caplan, is liable for taxes, penalties and interest pursuant to Section 212.0505, Florida Statutes, and assessing the amount of such liability at $13,964.25, plus interest at the rate of $3.25 per day from February 22, 1990. DONE AND ENTERED in Tallahassee, Leon County, Florida, this 30th day of March 1992. WILLIAM J. KENDRICK Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 30th day of March 1992.
The Issue The issue is whether Petitioner is a common carrier for the purpose of prorating taxes under Section 212.08(9)(b), Florida Statutes, and Rule 12A-1.064(4)(a), Florida Administrative Code.
Findings Of Fact Petitioner owns Jumbo Interstate Trucking. Petitioner's principal place of business is located in Palm Coast, Florida. The Federal Highway Administration issued Permit No. MC326745 to Petitioner to operate as a contract carrier with a service date of October 17, 1997. Petitioner's federal permit authorizes him to engage in the transportation of property (except household goods) by motor vehicle in interstate or foreign commerce. Common carriers transport cargo according to a rate schedule that applies to anyone in the general public. Contract carriers haul cargo according to market rates and pursuant to an arm's length contract that sets the mileage and freight rates with individual customers. At all times material to this case, Petitioner hauled goods in interstate commerce outside the State of Florida as a common carrier. He does not haul goods as a common carrier pursuant to a predetermined rate schedule or published tariffs. According to Petitioner, he negotiates his contracts as he goes along. Petitioner has never operated or filed an application to operate his business other than as a contract carrier. Additionally, his motor vehicles are not insured as common carriers.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED: That Respondent issue a final order denying Petitioner's request for a refund. DONE AND ENTERED this 10th day of June, 2002, in Tallahassee, Leon County, Florida. SUZANNE F. HOOD Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 10th day of June, 2002. COPIES FURNISHED: Raymond Gunter Jumbo Interstate Trucking 45 Moody Drive Palm Coast, Florida 32137 R. Lynn Lovejoy, Esquire Office of the Attorney General The Capitol, Tax Section Tallahassee, Florida 32399-1050 Bruce Hoffmann, General Counsel Department of Revenue 204 Carlton Building Tallahassee, Florida 32399-0100 James Zingale, Executive Director Department of Revenue 104 Carlton Building Tallahassee, Florida 32399-0100
Findings Of Fact In 1987, Petitioner grew thirty (30) pounds of marijuana with a fair market value of $20,000. The marijuana was grown within the State of Florida. In 1988, Petitioner grew 116 pounds of marijuana with a fair market value of $500 per pound for a total of $58,000. This marijuana was also grown within the State of Florida. The growing of marijuana is a taxable event in Florida pursuant to Section 212.0505, Florida Statutes. The tax is assessed at the fair market value of the marijuana grown. Additionally, there are surcharges and penalties assessable under the same statute for growing marijuana. The tax attributable to Petitioner's enterprise is as follows: 20% tax of fair market value $15,600.00 5% penalty per month up to 25% of tax due 3,900.00 Additional 50% penalty 7,800.00 1% interest per month as of date of final hearing (October 24, 1989) ($5.13 per day) from date of hearing) 2,746.14 Total $30,046.14 Petitioner did not demonstrate any defense to the assessment of this tax by the Department and did not demonstrate a defense to the payment of the above assessment. Petitioner, therefore, owes the Department $30,046.14 in penalties and taxes plus interest at the rate of $5.13 per day from October 24, 1989.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is: RECOMMENDED that the Department enter a Final Order upholding the jeopardy assessment, dated March 8, 1989, assessing the Respondent $30,046.14 in penalties and taxes plus $5.13 per day from October 24, 1989. DONE and ENTERED this 31 day of January, 1990, in Tallahassee, Leon County, Florida. DIANE CLEAVINGER Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904)488-9675 Filed with the Clerk of the Division of Administrative Hearings this 31 day of January, 1990. APPENDIX TO CASE The facts contained in paragraphs 1, 2, 4, 7, 8, 10, 11, 12, 13, 14, 15, 16, 17, 18, 21, 22, 24, 25 and 26 of Respondent's Proposed Recommended Order are adopted, in substance, insofar as material. The facts contained in paragraphs 3, 5, 6, 9, 19, 20 and 23 of Respondent's Proposed Recommended Order are subordinate. COPIES FURNISHED: William D. Moore General Counsel Department of Revenue 203 Carlton Building Tallahassee, Florida 32399-0100 Katie D. Tucker Executive Director 104 Carlton Building Tallahassee, Florida 32399-0100 William Clayton Sapp #114370 Cross City Correctional Institution Work Camp P.O. Box 1500-236WC Cross City, Florida 32628 Lee Rohe, Esquire Department of Legal Affairs The Capitol - Tax Section Tallahassee, Florida 32399-1050
The Issue Whether Respondent, Neighborhood Grill, Inc., d/b/a Neighborhood Sports Grill (Respondent), failed to remit monies owed to Petitioner, Department of Business and Professional Regulation, Division of Alcoholic Beverages and Tobacco (the Department) pursuant to the surcharge provisions found in Section 561.501, Florida Statutes (2006). If so, whether the Department should impose discipline against Respondent for that failure.
Findings Of Fact At all times material to the allegations of this case, the Department has been the state agency charged with the responsibility of regulating persons holding alcoholic beverage licenses. At all times material to the allegations of this matter Respondent has held license number 60-13254, series 4-COP., which was duly issued Respondent by the Department. At all times material to the allegations of this matter, Respondent was obligated to pay monthly surcharge taxes to the Department pursuant to the provisions of Section 561.501, Florida Statutes (2006). Respondent elected to have these surcharge taxes based on the "purchase method," i.e., based on the volume of alcohol Respondent purchased from its suppliers during the month.2 The Department routinely audits licensees to compare the surcharge taxes remitted by the licensee with the records maintained by the licensee’s suppliers and/or by the licensee. The purpose of the audit is to verify that surcharge tax paid by a licensee was based on a correct calculation of its surcharge tax obligation. In this case, the Department audited Respondent for the subject audit period of October 1, 2006, through June 30, 2007. Mr. Marrero began the subject audit by issuing an engagement letter to Respondent that included a questionnaire. In addition to other information, the questionnaire requested Respondent to identify its beverage suppliers. Respondent did not respond to the engagement letter or to the questionnaire. Based on records available to him, including information as to Respondent’s beverage suppliers gathered during prior audits, Mr. Marrero was able to identify Respondent’s major beverage suppliers. Consistent with the Department’s policies, Mr. Marrero contacted Respondent’s beverage suppliers to obtain records of all sales of alcoholic beverages those suppliers had made to Respondent during the subject audit period. Those beverage suppliers then provided their records to establish the beverages sold to Respondent during the subject audit period. Based upon those records Mr. Marrero determined the volume of alcoholic beverages purchased by Respondent during the subject audit period and calculated the surcharge tax due and owing to the Department for the subject audit period. Mr. Marrero compared the amount of the surcharge tax he calculated with the surcharge tax paid by Respondent to the Department for the subject audit period. Based upon that comparison, Mr. Marrero determined that Respondent had failed to remit the correct surcharge taxes payment based on underpayment, non-payment, and late payment. More specifically, Mr. Marrero calculated that the Respondent owed the Department additional surcharge tax in the principal amount of $6,265.06; surcharge interest in the amount of $589.93; and surcharge penalties in the amount of $3,467.05. Mr. Marrero determined that Respondent owed the Department the total amount of $10,322.04. Mr. Torres reviewed the audit prepared by Mr. Marrero and verified its accuracy. Mr. Marrero and Mr. Torres have the requisite education, training, and experience to conduct the subject audit (in the case of Mr. Marrero) and to review the subject audit to verify its accuracy (in the case of Mr. Torres). The subject audit accurately reflects the amounts Respondent owes the Department. On May 5, 2008, the Department provided Respondent a copy of its audit summary and demanded payment of the amounts due. Respondent has not paid any portion of the total sum ($10,322.04) identified as being due by the audit summary.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Business and Professional Regulation, Division of Alcoholic Beverages and Tobacco, enter a Final Order providing that the Respondent owes it surcharge taxes in the principal amount of $6,265.06, surcharge interest in the amount of $589.93, and surcharge penalties in the amount of $3,467.05, for a total amount of $10,322.04. The Final Order should give the Respondent a period of 30 days to remit the full amount $10,322.04 or make acceptable arrangements for the payment. The Final Order should revoke Respondent’s license if Respondent fails to timely remit the full amount due or make acceptable arrangements for such payment. DONE AND ENTERED this 5th day of June, 2009, in Tallahassee, Leon County, Florida. CLAUDE B. ARRINGTON Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 5th day of June, 2009.
The Issue The issue in this case is whether the Respondent, Department of Revenue (Respondent or Department), may levy on the Petitioner’s bank account in order to satisfy a tax liability owed to the Respondent. The Respondent asserts the Petitioner, Business Depot-Accounting and Tax Center, Inc. (Petitioner), owes the Department for delinquent sales tax, interest, and penalties.
Findings Of Fact The Respondent is the state agency charged with the responsibility of collecting sales and use tax owed to the State of Florida. See § 213.05, Fla. Stat. (2006). At all times material to the allegations of this case, the Petitioner was responsible for collecting and remitting to the Department sales and use tax. The return forms itemizing information for these payments require the taxpayer, Petitioner, to represent gross sales, exempt sales, as well as other data that the Department uses to compute the amount that must be remitted to the state. In this case, after extensive communications with the Petitioner, the Department determined that $10,524.20 was owed for taxes, penalties, and interest. This amount was calculated based on estimates of the delinquency. A Notice of Final Assessment dated August 28, 2006, was issued by the Department to the Petitioner that outlined the amounts claimed to be owed. On or about September 27, 2006, the Petitioner responded to the notice and, under oath, represented that the tax returns were filed. The Department took the Petitioner’s representations into consideration and re-calculated the tax liability owed by the Petitioner. Currently, the Department asserts that the Petitioner’s delinquent amount is $278.46. Accordingly, when that amount remained unpaid, the Department sought a tax warrant, gave notice of its intent to levy on the assets of the Petitioner, and provided notice that it intended to collect monies against the Petitioner’s bank account at Regent Bank. The Department issued a Notice of Freeze to the Regent Bank that instructed it not to transfer, dispose of, or return assets belonging to the Petitioner. The Department also gave notice to the Petitioner of its intent to levy on the bank account with a formal Notice of Intent to Levy. The Petitioner challenged the notice by seeking an administrative hearing. The Petitioner did not appear at the hearing and did not offer any evidence in support of its challenge. The Petitioner’s letter dated September 28, 2006, was not submitted within twenty days of the issuance of the Notice of Final Assessment.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Revenue enter a Final Order sustaining the Notice of Intent to Levy against the Petitioner’s assets in the amount of $278.46 to satisfy the liability owed by the Petitioner to the Department. DONE AND ENTERED this 2nd day of May, 2007, in Tallahassee, Leon County, Florida. S J. D. Parrish Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 2nd day of May, 2007. COPIES FURNISHED: S. G. Ross Business Depot-Accounting & Tax Center, Inc. 4611 South University Drive, Suite 455 Davie, Florida 33328 John Mika, Esquire Assistant Attorney General Office of the Attorney General The Capitol, Plaza Level 01 Tallahassee, Florida 32399-1050 Bruce Hoffmann, General Counsel Department of Revenue 501 South Calhoun Street The Carlton Building, Room 204 Tallahassee, Florida 32399-0100 James Zingale, Executive Director Department of Revenue 501 South Calhoun Street The Carlton Building, Room 104 Tallahassee, Florida 32399-0100
The Issue The Department hereby adopts and incorporates by reference the Statement of the Issue set forth in the Recommended Order.
Recommendation Based on the foregoing, it is recommended that the Department enter a final order dismissing the subject notice of assessment and jeopardy findings. DONE AND ENTERED in Tallahassee, Leon County, Florida, this 10th day of January 1991. WILLIAM J. KENDRICK Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, FL 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 10th day of January, 1991.
The Issue The issue is whether Respondent attempted to obtain his license to practice medicine by fraudulent representations, in violation of Section 458.331(1)(a), Florida Statutes, or if Respondent misrepresented or concealed a material fact during any phase of a licensing or disciplinary process, in violation of Section 458.331(1)(gg), Florida Statutes. If so, an additional issue is what penalty the Board of Medicine should impose.
Findings Of Fact By application dated and acknowledged on December 27, 1993, Respondent applied for a medical license by endorsement. Respondent filed the application with the Board of Medicine on January 12, 1994. Question 6 on the application asks: Have you ever been convicted of a felony? Yes No ; a misdemeanor? Yes No . Have any judgments ever been entered against you? Yes No . Have you ever been sued for malpractice? Yes No . In response, Respondent typed X’s in the “No” boxes for the first two questions in Question 6. Immediately above the signature of Respondent and acknowledgement of the notary public, on the last page of the application, is the statement: I have carefully read the questions in the foregoing application and have answered them completely, without reservations of any kind, and I declare under penalty of perjury that my answers and all statements made by me are true and correct. Should I furnish any false information in this application, I hereby agree that such act shall constitute cause for denial, suspension or revocation of my license to practice medicine/surgery in the State of Florida. In fact, on October 24, 1988, Respondent was found guilty, after a three-day jury trial, of 12 misdemeanor counts of failure to remit a total of over $47,000 in state sales taxes due from November 20, 1985, through December 20, 1986. On December 22, 1988, the court sentenced Respondent to pay a fine of $12,000 on all 12 counts and reasonable court costs, and serve six months’ probation on each of the 12 counts, with the periods of probation to run consecutively. Respondent’s explanation for the omission from the application is that he mistakenly believed that the only misdemeanors covered by the question were those involving the practice of medicine. Respondent’s explanation for the nondisclosure is unreasonable. Nothing in the language of Question 6 limits the scope of the inquiry to misdemeanors involving the practice of medicine. The preceding question in Question 6 asks about felonies without qualification or limitation, and it is absurd to interpret this question as not asking about any felony, such as bank robbery, even though the felony did not involve the practice of medicine. For the same reason, Respondent knew that he was to have disclosed any misdemeanor, even if it did not involve the practice of medicine. Respondent’s explanation for the commission of the crimes is more plausible. Briefly, Respondent testified that he had invested about $100,000 of the total of $250,000 in the acquisition of the Philadelphia franchise of long-distance telephone provider that had emerged immediately following the breakup of AT&T in the mid 1980s. Essentially reselling AT&T long-distance services, the new company paid AT&T at wholesale for the services that it marked up and sold at retail to end users. Respondent explained that he had been an absentee owner for much of the time. Also, the AT&T billing for this new arrangement was confused and irregular. Changes in ownership preceding and following Respondent’s investment in the company further complicated the situation. A Pennsylvania revenue auditor contacted Respondent over a year after he had sold his stock in the company in 1986, gotten married, and been traveling extensively out of state. At this time, Respondent learned of the company’s sales tax problems, which involved a complicated telecommunications excise tax. Respondent’s corporate purchaser was no longer operating the company, which had become bankrupt. Respondent paid the taxes due, but the Commonwealth of Pennsylvania nevertheless prosecuted him for his role in the failure of the company to pay its taxes. After sentencing, Respondent paid the fine and served his probation without incident. He disclosed the misdemeanor convictions to the Pennsylvania agency regulating the practice of medicine and was able to continue practicing medicine there. After consideration of Respondent’s application, the Florida Board of Medicine issued Respondent license number ME 0066606.
Recommendation It is RECOMMENDED that the Board of Medicine enter a final order dismissing the Administrative Complaint against Respondent. DONE AND ENTERED this 4th day of December, 2000, in Tallahassee, Leon County, Florida. ROBERT E. MEALE Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 4th day of December, 2000. COPIES FURNISHED: Tanya Willaims, Executive Director Board of Medicine Department of Health 4052 Bald Cypress Way Bin C03 Tallahassee, Florida 32399-1701 William W. Large, General Counsel Department of Health 4052 Bald Cypress Way Bin A02 Tallahassee, Florida 32399-1701 Theodore M. Henderson, Agency Clerk Department of Health 4052 Bald Cypress Way Bin A02 Tallahassee, Florida 32399-1701 Kim M. Kluck Carol Gregg Senior Attorneys Agency for Health Care Administration Post Office Box 14229 Tallahassee, Florida 32317-4229 Christopher Grillo 1 East Broward Boulevard, Suite 700 Fort Lauderdale, Florida 33301
