Below is the text of the hearing. This is another contention denied based on lack of evidence presented. It sounds like the taxpayer could have legitimate technical basis, however failed to provide something of merit. Seems possible that a district court case makes sense in this context. One conclusion caught my eye.
A taxpayer is generally required to support its contentions by source records. Comptroller’s Decision No. 112,607 (2019).
There is basis for this in administrative practice and procedure, with slightly different wording in 34 Tex. Admin. Code § 1.26 - Burden and Standard of Proof in Contested Cases.
a) General rule. Pursuant to Tax Code, § 111.0041, the taxpayer must produce contemporaneous records and supporting documentation appropriate to the tax or fee for the transactions in question to substantiate and enable verification of the taxpayer's claim related to the amount of tax, penalty, or interest to be assessed, collected, or refunded.
(b) The AHS has the burden to prove by clear and convincing evidence:
(1) liability for the additional penalty under Tax Code, § 111.061(b); and
(2) personal liability for fraudulent tax evasion under Tax Code, § 111.0611.
(c) The taxpayer has the burden to prove by clear and convincing evidence that the taxpayer or a transaction qualifies for an exemption or a deduction tantamount to an exemption.
(d) The AHS has the burden to prove by a preponderance of the evidence that an exclusion from an exemption applies.
(e) In all other cases, the taxpayer has the burden of proof by a preponderance of the evidence.
'Source records' and 'contemporaneous records' are not the same, and it's a bit unusual to use slightly more restrictive language on the taxpayer with no further context. Not particularly great to see.
SOAH DOCKET NO. 304-24-24416
CPA HEARING NO. 117,930
RE: COMPANY A
TAXPAYER NO: **************
AUDIT OFFICE: **************
AUDIT PERIOD: April 1, 2014 THROUGH July 31, 2017
Sales And Use Tax/RFD
SOAH DOCKET NO. 304-24-24417
CPA HEARING NO. 117,931
RE: COMPANY A
TAXPAYER NO: **************
AUDIT OFFICE: **************
AUDIT PERIOD: April 1, 2014 THROUGH July 31, 2017
Sales And Use Tax/RDT
SOAH DOCKET NO. 304-24-24419
CPA HEARING NO. 118,190
RE: COMPANY A
TAXPAYER NO: **************
AUDIT OFFICE: **************
AUDIT PERIOD: August 1, 2017 THROUGH December 31, 2018
Sales And Use Tax/RFD
SOAH DOCKET NO. 304-24-24421
CPA HEARING NO. 118,191
RE: COMPANY B
TAXPAYER NO: **************
AUDIT OFFICE: **************
AUDIT PERIOD: January 1, 2015 THROUGH December 31, 2018
Sales And Use Tax/RFD
BEFORE THE COMPTROLLER OF PUBLIC ACCOUNTS
OF THE STATE OF TEXAS
GLENN HEGAR
Texas Comptroller of Public Accounts
ROBERT SCOTT
Representing Respondent
**************
Representing Claimant
COMPTROLLER’S DECISION
This decision is considered final on April 21, 2025, unless a motion for rehearing is timely filed; this date of finality is calculated based on the Administrative Procedure Act (APA).[1] The failure to timely file a motion for rehearing may result in adverse legal consequences.
Administrative Law Judge (ALJ) Kimberly LaFlair of the State Office of Administrative Hearings (SOAH) issued a Proposal for Decision (PFD) that includes Findings of Fact and Conclusions of Law. SOAH served the PFD on each party and each party was given an opportunity to file exceptions and replies with SOAH in accordance with SOAH’s rules of procedure. The ALJ recommended that the Comptroller adopt the PFD as written.
After review and consideration, IT IS ORDERED that the PFD is adopted as changed.[2]
The results from this Decision are Attachments A. The ALJ’s recommendation letter is Attachment B. The PFD as changed is Attachment C. Attachments A, B, and C are incorporated by reference.
Attachments A reflect zero amounts due.
SIGNED on this 20th day of March 2025
GLENN HEGAR
Comptroller of Public Accounts
By: Lisa Craven
Deputy Comptroller
Attachments A, Texas Notifications of Hearing Results
Attachment B, ALJ’s recommendation letter
Attachment C, Proposal for Decision as changed
ATTACHMENT C
SOAH Docket Nos. 304-24-24416; -24417; -24419; -24421
Before the State Office of Administrative Hearings
TCPA Hearing Nos. 117,930; 117,931; 118,190; 118,191
Proposal for Decision
COMPANY A (Claimant A) and COMPANY B (Claimant B) (collectively, Claimants) requested refunds of sales and use tax paid on telecommunication services that they contend do not terminate within Texas. [ENDNOTE 3] The Tax Division (Staff) of the Texas Comptroller of Public Accounts (Comptroller) denied the refund requests. Claimants requested a refund hearing on the denial of their claims, contending that they owe tax based on a percentage of the number of their agents in Texas rather than the number of their total agents worldwide. Staff disagrees. In this Proposal for Decision, the Administrative Law Judge (ALJ) recommends the denial of the refund claims be upheld because Claimants failed to meet their burden.
I. Notice, Jurisdiction, and Procedural History
Staff referred these cases to the State Office of Administrative Hearings (SOAH) and, on August 26, 2024, issued Notices of Hearing by Written Submission. On September 12, 2024, ALJ Kimberly LaFlair issued an order consolidating cases and setting the written submission hearing. Robert Scott represented Staff. ************** of COMPANY C represented Claimants. The contested case record closed on November 18, 2024.
There are no issues of notice or jurisdiction; therefore, those matters are set out in the Findings of Fact and Conclusions of Law without further discussion.
II. REASONS FOR DECISION
A. Evidence
Claimants did not submit an exhibit list, evidentiary exhibits, or argument for the written submission hearing. Staff submitted the pleadings exchanged between the parties prior to referring the matter to SOAH and offered the following exhibits:
SOAH Docket Nos. 304-24-24416 and 304-24-24417:
Comptroller 60-Day Letter;
Texas Notification of Audit Results;
Penalty & Interest Waiver Worksheet;
Audit Report;
Audit Documentation Report;
Independent Audit Review (IAR) Report;
COMPANY D, Account No. **************, Invoice No. 7263606783 (October 1, 2016);
COMPANY D Account **************, Invoice No. GZ58476 (August 1, 2016);
COMPANY E, Account No. **************, Invoice No. 51557132 (February 1, 2017); and
COMPANY E, Account No. **************, Invoice No. 51572642 (February 1, 2017).
SOAH Docket No. 304-24-24419: [ENDNOTE 4]
Comptroller 60-Day Letter;
Refund Denial Letter;
Record of Audit Planning, Activities, and Results for Refund Assignments;
IAR Report;
COMPANY D, Account No. **************, Invoice No. 7263606783 (October 1, 2016);
COMPANY D, Account **************, Invoice No. GZ58476 (August 1, 2016);
COMPANY E, Account No. **************, Invoice No. 51557132 (February 1, 2017); and
COMPANY E, Account No. **************, Invoice No. 51572642 (February 1, 2017).
SOAH Docket No. 304-24-24421: [ENDNOTE 5]
Comptroller 60-Day Letter;
Refund Denial Letter;
Record of Audit Planning, Activities, and Results for Refund Assignments;
IAR Report;
COMPANY D, Invoice No. 2163197920;
COMPANY G, Invoice No. 28053151007493;
COMPANY H, Invoice No. Z6386112; and
COMPANY J, Invoice No. 9555-ALLO3N-060718.
Staff’s exhibits are admitted.
B. Staff Agreed Adjustments
There are no agreed adjustments.
C. Material Facts Established by the Evidence
Claimant A provides debt collection services and was acquired by Claimant B in 2016. Claimant B is a business process outsourcing company that serves customers in communications, financial services, healthcare, retail, and technology across the globe, and is headquartered in CITY, California. Claimant B is the holding company of various subsidiaries, including Claimant A. Claimant A operates across the United States and has call centers and a regional office in Texas.
In June 2017, Staff initiated an audit to verify Claimant A’ compliance with Texas sales and use tax laws during the audit period April 1, 2014, through July 31, 2017. Claimant A provided a chart of accounts, financial statements, federal income tax returns, sales journals, tax workpapers, depreciation schedules, tax accrual worksheets, and purchase invoices.
The audit consists of four exams. Exam 1 is a detailed examination, which includes adjustments for tax collected but not remitted (TCNR). Exam 2 was estimated, and adjustments were made for disallowed deductions. The exam was estimated because detailed records of service benefit locations were not provided. Exam 3 is a detailed examination, making adjustments for taxable purchases of assets. Exam 4 is a detailed examination, which makes adjustments for taxable purchases of expenses.
On December 14, 2018, Staff issued Claimant A a Texas Notification of Audit Results assessing tax and accrued interest. Claimant A paid the liability and filed a refund claim on February 11, 2019, requesting a refund for telecommunication services received during the period of August 1, 2017, through December 31, 2018. On February 11, 2019, Claimant B also filed a claim requesting a refund on telecommunication services it received for the period of January 1, 2015, through December 31, 2018.
The refund claims filed by Claimants request sales tax refunds to account for tax-exempt telecommunication services that Claimants contend originate and are billed to a service address outside of Texas. More specifically, Claimants contend that their use of a Texas private branch exchange (PBX) causes interstate telecommunications services originating outside of Texas to pass through the state to terminate outside of the state. Claimants assert that they “switch” calls they receive at their PBX in Texas to one of thousands of COMPANY B agents, located worldwide, including agents in Texas, and that they obtain telecommunication services from several carriers. Claimants may not use the same carrier that transmitted the call to the PBX as the one that transmits it from Texas to outside the state. Those carriers, according to Claimants, collected Texas sales and use tax for telecommunication services based on their belief that there was a termination point in Texas. Claimants estimate that they owe tax based on a percentage of the number of their agents in Texas compared to the number of total agents worldwide.
The refund claims were fully denied for the following reasons: clear and convincing evidence was not provided to support the refund; the burden of proof to show tax was unlawfully or erroneously collected was not met; and the estimation of the refund claim is merely an approximation and not in accordance with the Comptroller’s sampling procedures.
An Independent Audit Review (IAR) conference was held on May 20, 2020, for both Claimants on all refund periods. The IAR conference reviewed Claimants’ contention that they are entitled to a refund of Texas state and local sales and use taxes they erroneously paid on purchases of telecommunications services they contend are long distance calls that terminated outside of Texas. The recommendation in the IAR report, issued for all refund periods and for both Claimants, agreed with the Comptroller that the refund requests should be fully denied because Claimants failed to provide clear and convincing evidence to support their contention that Claimants’ routing of incoming calls, using their privately owned PBX system, to their agents outside of Texas, converts or extends the original taxable telecommunication services, provided by their vendors and listed within the refund request, into exempted interstate long-distance telecommunication services.
Claimants timely requested refund hearings. Staff did not agree to any adjustments and referred the matter to SOAH. On October 14, 2024, Staff provided supplemental exhibits in each of the hearings. Claimants did not provide evidence for the written submission hearing.
D. ALJ’s Analysis and Recommendations
If the Comptroller finds that an amount of tax, penalty, or interest has been unlawfully or erroneously collected, the Comptroller shall credit or refund the amount. Tex. Tax Code § 111.104(a). When a taxpayer requests a refund, it must establish by a preponderance of evidence that taxes were erroneously collected or paid. See, e.g., 34 Tex. Admin. Code § 1.26(e); Comptroller’s Decision No. 109,787 (2015). If a claimant relies on an exemption to establish the error, then it must provide clear and convincing evidence. 34 Tex. Admin. Code § 1.26(c); Comptroller’s Decision No. 100,477 (2012). Furthermore, exemptions from taxation are subject to strict construction since they are the antithesis of equality and uniformity and because they place a greater burden on other taxpaying businesses and individuals. See Bullock v. National BancShares Corp., 584 S.W.2d 268 (Tex. 1979). An exemption cannot be raised by implication, but must affirmatively appear, and all doubts are resolved in favor of the taxing authority and against a claimant. See, e.g., Comptroller’s Decision Nos. 41,522, 44,260 (2010).
Texas imposes a tax on each sale of a taxable item in this state. Tex. Tax Code § 151.051. The term “taxable item” includes tangible personal property and taxable services. Id. § 151.010. When tax is imposed on tangible personal property, the taxing entity’s prima facie burden of proof is easily met because, unless an exemption applies, all sales of tangible personal property in this state are taxable. Comptroller’s Decision No. 117,502 (2022). However, only those services specifically enumerated in Texas Tax Code § 151.0101 are taxable. To impose tax on a service, Staff must demonstrate not only that a service was sold but also that the service was taxable. See, e.g., Comptroller’s Decision No. 102,386 (2014). If Staff meets its initial prima facie burden, Claimants must establish by a preponderance of the evidence that the service is not taxable, or by clear and convincing evidence that the work was exempt from taxation. 34 Tex. Admin. Code § 1.26; see also, Comptroller’s Decision Nos. 100,933 (2009); 102,792 (2010).
Texas imposes tax on telecommunications services. Tex. Tax Code §§ 151.0101(a)(6) and 151.0103. Telecommunications services means the electronic or electrical transmission, conveyance, routing, or reception of sounds, signals, data, or information utilizing wires, cable, radio waves, microwaves, satellites, fiber optics, Voice over Internet Protocol (VoIP), or any other method now in existence or that may be devised, including, but not limited to, long distance telephone services. 34 Tex. Admin. Code §§ 3.344(a)(13), 3.345(a)(11); see also Tex. Tax Code § 151.0103.
The taxability of telecommunication services is not in dispute and the ALJ finds that Staff met is burden to both demonstrate that a service (telecommunications) was sold to Claimants and that the service was taxable. Therefore, it is Claimants’ burden to establish by a preponderance of the evidence that the service is not taxable, or by clear and convincing evidence that the services were exempt from taxation. Because Claimants’ refund is based on their contention that telecommunications terminate outside the state and not within Texas and is based on the exemption in Texas Tax Code Section 151.323, Claimants must prove by clear and convincing evidence that the telecommunication services at issue are exempt from taxation.
Texas Tax Code Section 151.323(a) exempts from sales and use tax the receipts from certain telecommunication services: (1) long-distance telecommunications services that are not both originated from and billed to a telephone number or billing or service address within Texas; (2) access to a local exchange telephone company’s network by a regulated provider of telecommunications services; and (3) broadcasts, other than cable television service, by commercial radio or television stations licensed or regulated by the Federal Communications Commission. With respect to Texas Tax Code Section 151.323(a)(1), the Comptroller has construed “long distance” to mean “interstate long-distance.” 34 Tex. Admin. Code § 3.344(b)(5); Comptroller’s Decision Nos. 41,383 et al. (2009) (15 joined hearings) (citing Comptroller’s Decision Nos. 43,983 (2005) and 26,921 (1991)).
While Claimants agree that their telecommunication services are generally subject to Texas sales and use tax, they contend that the issues present in this hearing represent a “unique fact pattern and network infrastructure that allows their purchases to be excluded from Texas sales and use tax.” Staff disagrees and contends that Claimants offered no evidence to show that there was no termination point in Texas. To support this contention, Staff states that there is no evidence to support that any of the carriers incorrectly believed there was a termination point in Texas and that invoices, some of which Staff provided as exhibits, show that Claimant was charged Texas sales and use tax for telecommunication services. Staff argues that in the absence of contrary evidence, the carriers correctly charged for intrastate Texas telecommunications services, for interstate telecommunications services originating from Texas and terminating outside of the state, and for services performed in Texas. The IAR report also agreed with Staff, finding that Claimants failed to provide clear and convincing evidence to support their contention that Claimants’ routing of incoming calls, using their privately owned PBX system, to their agents outside of Texas, converts or extends the original taxable telecommunication services, provided by their vendors and listed within the refund request, into exempted interstate long-distance telecommunication services per Texas Tax Code Section 151.323(a)(1) and 34 Texas Administrative Code Section 3.344(c)(1).
Claimant must produce contemporaneous records and supporting documentation appropriate to the tax or fee for the transactions in question to substantiate and enable verification of the taxpayer’s claim related to the amount of tax, penalty, or interest to be assessed, collected, or refunded. 34 Tex. Admin. Code § 1.26(a). A taxpayer is generally required to support its contentions by source records. Comptroller’s Decision No. 112,607 (2019). Bare assertions are not a substitute for evidence and are insufficient to establish audit error. Comptroller’s Decision No. 115,999 (2020), citing to Baker v. Bullock, 529 S.W.2d 279 (Tex. Civ. App.—Austin 1975, writ ref’d n.r.e.); see also Comptroller’s Decision No. 107,916 (2013). The Comptroller has held that summary documents that are created by the taxpayer and submitted without underlying support are tantamount to bare assertions, i.e., they are not considered evidence. See, e.g., Comptroller’s Decision Nos. 115,535 (2020), 102,488 (2010).
As stated above, Claimants failed to submit any documentation to support their contentions. There is no evidence in the record that Claimants’ telecommunication services did not terminate in Texas and therefore qualify for the exemption in Texas Tax Code Section 151.323(a). The ALJ find Claimants failed to meet their burden to show the telecommunication services at issue did not terminate in Texas, qualifying them for exemption, and recommends the refund denials be upheld.
With regard to Claimants’ additional contentions related to the estimation procedures they used to determine the requested refund amount, the ALJ will not address those matters as it was determined Claimants did not meet their burden to show that the telecommunication services in issue are exempt from taxation.
III. Findings of Fact
COMPANY A (Claimant A) provides debt collection services and was acquired by COMPANY B (Claimant B) in 2016.
Claimant B is a business process outsourcing company that serves customers in communications, financial services, healthcare, retail, and technology across the globe, and is headquartered in CITY, California.
Claimant A operates across the United States and has call centers and a regional office in Texas.
Claimant B is the holding company of various subsidiaries, including Claimant A.
In June 2017, Staff initiated an audit to verify Claimant A’s compliance with Texas sales and use tax laws during the audit period April 1, 2014, through July 31, 2017.
Claimant A provided a chart of accounts, financial statements, federal income tax returns, sales journals, tax workpapers, depreciation schedules, tax accrual worksheets, and purchase invoices.
The audit consists of four exams. Exam 1 is a detailed examination, which includes adjustments for tax collected but not remitted (TCNR). Exam 2 was estimated, and adjustments were made for disallowed deductions. The exam was estimated because detailed records of service benefit locations were not provided. Exam 3 is a detailed examination, making adjustments for taxable purchases of assets, and Exam 4 is a detailed examination, which makes adjustments for taxable purchases of expenses.
On December 14, 2018, Staff issued Claimant A a Texas Notification of Audit Results assessing tax and accrued interest. Claimant A paid the liability, and then requested a refund on telecommunication services purchased during the audit period.
Claimant A filed a refund claim on February 11, 2019, requesting a refund for telecommunication services during the period of August 1, 2017, through December 31, 2018.
On February 11, 2019, Claimant B filed a claim requesting a refund on telecommunication services for the period of January 1, 2015, through December 31, 2018.
The refund claims filed by Claimants request refunds for calls that originate and are billed to a service address outside of Texas.
The refund claims were fully denied for the following reasons: clear and convincing evidence was not provided to support the refund; the burden of proof to show tax was unlawfully or erroneously collected was not met; and the estimation of the refund claim is merely an approximation and not in accordance with the Comptroller’s sampling procedures.
An Independent Audit Review (IAR) conference was held on May 20, 2020, for both Claimants on all refund periods.
The IAR conference reviewed Claimants’ contention that they are entitled to a refund of Texas state and local sales and use taxes they erroneously paid on purchases of telecommunications services they contend are long distance calls that terminated outside of Texas.
The recommendation in the IAR report issued for all refund periods and for both Claimants agreed with the Comptroller that the refund requests should be fully denied because Claimants failed to provide clear and convincing evidence to support their contention that Claimants’ routing of incoming calls, using their privately owned PBX system, to their agents outside of Texas, converts or extends the original taxable telecommunication services, provided by their vendors and listed within the refund request, into exempted interstate long-distance telecommunication services.
Claimants timely requested refund hearings.
Staff did not agree to any adjustments and referred the matter to the State Office of Administrative Hearings (SOAH).
On August 26, 2024, Staff issued Notices of Hearing by Written Submission. The notices contained a statement of the nature of the hearing; a statement of the legal authority and jurisdiction under which the hearing was to be held; a reference to the particular sections of the statutes and rules involved; and a short, plain statement of the factual matters asserted, or an attachment that incorporated by reference the factual matters asserted in the complaint or petition filed with the state agency.
On September 12, 2024, Administrative Law Judge (ALJ) Kimberly LaFlair issued an order consolidating cases and setting the written submission hearing.
Claimants did not submit an exhibit list, evidentiary exhibits, or argument for the written submission hearing.
The contested case record closed on November 18, 2024.
IV. Conclusions of Law
The Comptroller has jurisdiction over this matter. Tex. Tax Code ch. 111.
SOAH has jurisdiction over matters related to this hearing, including the authority to issue a proposal for decision with findings of fact and conclusions of law. Tex. Gov’t Code ch. 2003.
Staff provided proper and timely notice of the hearing. Tex. Gov’t Code ch. 2001; Tex. Tax Code § 111.105.
If the Comptroller finds that an amount of tax, penalty, or interest has been unlawfully or erroneously collected, the Comptroller shall credit or refund the amount. Tex. Tax Code § 111.104(a).
When a taxpayer requests a refund, it must establish by a preponderance of evidence that taxes were erroneously collected or paid. See 34 Tex. Admin. Code § 1.26(e); see also, e.g., Comptroller’s Decision No. 109,787 (2015).
If a claimant relies on an exemption to establish the error, then it must provide clear and convincing evidence. 34 Tex. Admin. Code § 1.26(c); Comptroller’s Decision No. 100,477 (2012).
Exemptions from taxation are subject to strict construction since they are the antithesis of equality and uniformity and because they place a greater burden on other taxpaying businesses and individuals. See Bullock v. National BancShares Corp., 584 S.W.2d 268 (Tex. 1979).
An exemption cannot be raised by implication, but must affirmatively appear, and all doubts are resolved in favor of the taxing authority and against a claimant. See, e.g., Comptroller’s Decision Nos. 41,522, 44,260 (2010).
Texas imposes a tax on each sale of a taxable item in this state. Tex. Tax Code § 151.051.
The term “taxable item” includes tangible personal property and taxable services. Tex. Tax Code § 151.010.
When tax is imposed on tangible personal property, the taxing entity’s prima facie burden of proof is easily met because, unless an exemption applies, all sales of tangible personal property in this state are taxable. Comptroller’s Decision No. 117,502 (2022).
Only those services specifically enumerated in Texas Tax Code § 151.0101 are taxable.
To impose tax on a service, Staff must demonstrate not only that a service was sold but also that the service was taxable. See, e.g., Comptroller’s Decision No. 102,386 (2014).
If Staff meets its initial prima facie burden, Claimants must establish by a preponderance of the evidence that the service is not taxable, or by clear and convincing evidence that the work was exempt from taxation. 34 Tex. Admin. Code § 1.26; see also, Comptroller’s Decision Nos. 100,933 (2009); 102,792 (2010).
Texas imposes tax on telecommunications services. Tex. Tax Code §§ 151.0101(a)(6) and 151.0103.
Telecommunications services means the electronic or electrical transmission, conveyance, routing, or reception of sounds, signals, data, or information utilizing wires, cable, radio waves, microwaves, satellites, fiber optics, Voice over Internet Protocol (VoIP), or any other method now in existence or that may be devised, including, but not limited to, long distance telephone services. 34 Tex. Admin. Code §§ 3.344(a)(13), 3.345(a)(11); see also Tex. Tax Code § 151.0103.
The ALJ finds that Staff met its burden to both demonstrate that a service (telecommunications) was sold to Claimants and that the service was taxable.
Texas Tax Code Section 151.323(a) exempts from sales and use tax the receipts from certain telecommunication services: (1) long-distance telecommunications services that are not both originated from and billed to a telephone number or billing or service address within Texas; (2) access to a local exchange telephone company’s network by a regulated provider of telecommunications services; and (3) broadcasts, other than cable television service, by commercial radio or television stations licensed or regulated by the Federal Communications Commission.
With respect to Texas Tax Code Section 151.323(a)(1), the Comptroller has construed “long distance” to mean “interstate long-distance.” 34 Tex. Admin. Code § 3.344(b)(5); Comptroller’s Decision Nos. 41,383 et al. (2009) (15 joined hearings) (citing Comptroller’s Decision Nos. 43,983 (2005) and 26,921 (1991)).
Claimant must produce contemporaneous records and supporting documentation appropriate to the tax or fee for the transactions in question to substantiate and enable verification of the taxpayer’s claim related to the amount of tax, penalty, or interest to be assessed, collected, or refunded. 34 Tex. Admin. Code § 1.26(a).
A taxpayer is generally required to support its contentions by source records. Comptroller’s Decision No. 112,607 (2019).
Bare assertions are not a substitute for evidence and are insufficient to establish audit error. Comptroller’s Decision No. 115,999 (2020), citing to Baker v. Bullock, 529 S.W.2d 279 (Tex. Civ. App.—Austin 1975, writ ref’d n.r.e.); see also Comptroller’s Decision No. 107,916 (2013).
The Comptroller has held that summary documents that are created by the taxpayer and submitted without underlying support are tantamount to bare assertions, i.e., they are not considered evidence. See, e.g., Comptroller’s Decision Nos. 115,535 (2020), 102,488 (2010).
The ALJ find Claimants failed to meet their burden to show the telecommunication services at issue did not terminate in Texas, qualifying them for exemption, and recommends the refund denials be upheld.
Signed December 19, 2024.
Kimberly LaFlair
Presiding Administrative Law Judge
ENDNOTES
[1] The date calculated is 25 days after this decision is signed. See APA, Tex. Gov’t Code § 2001.146(a); S.B. 1095, Acts 2017, 85th Leg. For additional guidance, refer to the Frequently Asked Questions Related to Motions for Rehearing, found here: http://comptroller.texas.gov/taxes/publications/96-1789.pdf
[2] See Tex. Gov’t Code § 2003.101(e) and (f).
[3] In SOAH Hearing No. 304-24-24417, COMPANY A requested redetermination to request a refund on telecommunications during the period of April 1, 2014, through July 31, 2017.
[4] In providing its supplemental exhibits, Staff added Exhibit Nos. 7-10 for Hearing Nos. 304-24-24416, 304-24- 24417, and 304-24-24419. This resulted in the skipping of numbers 5 and 6 in Hearing No. 304-24-24419. The ALJ renumbered the exhibits to be sequential.
[5] In providing its supplemental exhibits, Staff added Exhibit Nos. 11-13 for Hearing No. 304-24-24421, which resulted in the skipping of numbers 5-10. The ALJ renumbered the exhibits to be sequential.
ACCESSION NUMBER: 202503022H
SUPERSEDED: N
DOCUMENT TYPE: H
DATE: 2025-03-20
TAX TYPE: SALES
