Gorin v. Department of Revenue
TC-MD 140042N
Or. T.C.Jul 17, 2014Background
- Plaintiffs Allen and Leslie Gorin, Idaho residents who owned income-producing Oregon property, filed Oregon personal income tax returns for 2000–2010 in May 2012 after discovering a filing obligation in 2011.
- Department of Revenue assessed taxes, interest (ORS 305.220), a 100% failure-to-file penalty for three consecutive years (ORS 305.992), and a 25% post-amnesty penalty under SB 880 (2009) for failure to participate in the amnesty.
- Plaintiffs paid the assessments, then requested administrative waiver of the penalties and interest, claiming circumstances beyond their control.
- The Department’s conference officer waived 70% of the 100% failure-to-file penalty but denied the remaining 30%, the 25% post-amnesty penalty, and all interest; Plaintiffs appealed that denial to the Oregon Tax Court (Magistrate Division).
- Defendant moved to dismiss for lack of jurisdiction, arguing ORS 305.560(1)(a) bars appeals of discretionary denials of waiver. Plaintiffs did not dispute the statutory authority to assess the penalties, only the Department’s refusal to waive them.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Tax Court may review an administrative denial of waiver of penalties under ORS 305.560(1)(a) | Gorin: Department’s denial of waiver is reviewable by the Tax Court | Dept: ORS 305.560(1)(a) bars appeals from orders denying discretionary waiver of penalty or interest | Denied: statute bars appeals of discretionary waiver denials to Tax Court |
| Whether the Department’s authority to waive penalties under ORS 305.145(4) is discretionary | Gorin: relied on ORS 305.145 and OAR 150-305.145 to seek waiver (argues error in denial under the rule) | Dept: ORS 305.145(4) grants discretionary waiver authority; denials are discretionary | Held: ORS 305.145(4) is an express discretionary grant; denial is discretionary and unreviewable |
| Whether interest waiver under ORS 305.220 is discretionary and appealable | Gorin: seeks review of denial to waive interest charged under ORS 305.220 | Dept: ORS 305.145(3) gives discretionary authority to waive interest; denial is not appealable | Held: interest waiver is discretionary; denial is not appealable |
| Whether post-amnesty 25% penalty waiver is discretionary and appealable | Gorin: argues the post-amnesty penalty should be waived (cites rule allowing waiver for circumstances beyond control; legislative history suggests penalty aimed at willful nonfilers) | Dept: SB 880 imposes penalty; waiver authority rests on ORS 305.145(4) and OAR 150-305.100 which makes waiver discretionary | Held: waiver of post-amnesty penalty is discretionary under ORS 305.145(4) and Department rule; denial is not appealable |
Key Cases Cited
- Pelett v. Dept. of Rev., 11 OTR 364 (1990) (statute limits Tax Court jurisdiction; no review of department discretion to waive penalties or interest)
- ADC Kentrox v. Dept. of Rev., 19 OTR 91 (2006) (interpreting statutory grant of discretionary decision-making authority under ORS 305.145)