14-005048 Department Of Revenue vs. Dive Professionals, Inc., D/B/A Atlantis Dive Center Status: Closed Recommended Order on Friday, January 30, 2015.

Summary: Respondent failed to abide by terms of Compliance Agreement for repayment of sales and use tax and the filing of future returns. Recommend revocation of certificate of registration.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

DEPARTMENT OF REVENUE,

Petitioner,

vs. Case No. 14 - 5048

DIVE PROFESSIONALS, INC., d/b/a

ATLANTIS DIVE CENTER,

Respondent.

_______________________________/

RECOMMENDED ORDER

Purs uant to notice, a formal administrative hearing was

conducted before Administrative Law Judge Mary Li Creasy by video

teleconference at sites in Tallahassee and Miami, Florida, on

January 5, 2015.

APPEARANCES

For Petitioner: Angel Eason, Esquire

Office of the Attorney General

Plaza Level 01

The Capitol

Tallahassee, Florida 32399

For Respondent: (No A ppearance)

STATEMENT OF THE ISSUE

Whether Respondent ' s sales and use Certificate of

Reg istration should be revoked for failure to abide by the

repayment terms agreed to in a Compliance Agreement entered into

with Petitioner on August 29, 2013, as alleged in the Amended

Administrative Complaint for Revocation of Certificate of

Registration.

P RELIMINARY STATEMENT

Petitioner, Department of Revenue (Department), seeks to

revoke the Certificate of Registration issued to Respondent, Dive

Professionals, Inc., d/b/a Atlantis Dive Center, because of

Respondent ' s alleged long history of failing to comp ly with

chapters 212 and 443, Florida Statutes. As a result of

Respondent ' s alleged noncompliance, the Department initiated the

administrative proceeding to revoke Respondent ' s C ertificate of

R egistration pursuant to sections 212.18(3)(e) and 213.692(1),

Florida Statutes (2014). On or about September 23, 2014, the

Department filed an Amended Administrative Complaint for

Revocation of Certificate of Registration ( Amended Administrative

Complaint) against Respondent. Respondent timely requested an

administ rative hearing, and this matter was referred to the

Division of Administrative Hearings on October 27, 2014.

At the final hearing, the Department called one witness,

Maria V. Fernandez, a Revenue Specialist III at the Department,

and offered Petitioner ' s E xhibits 1 through 7, 9 , and 10 that

were admitted into evidence. Respondent did not appear for the

scheduled hearing and did not produce any exhibits or witnesses.

Official recognition was taken of five tax warrants recorded

in the official records of Mon roe County.

Neither party ordered a transcript of the final hearing.

The parties were permitted to file their proposed recommended

orders (PROs) by January 15, 2015. Petitioner filed its PRO on

January 13, 2015. Respondent did not file a PRO. The

Petit ioner ' s PRO has been taken into consideration in the

drafting of this Recommended Order.

Unless otherwise indicated, all statutory references are to

the versions in effect at the time of the alleged violations.

FINDING S OF FACT

1. The Department is the st ate agency charged with

administering and enforcing Florida ' s revenue laws, including the

laws related to the imposition and collection of sales and use

tax pursuant to chapter 212, Florida Statutes (2014).

2. Respondent is a Florida Profit Corporation do ing

business at 90791 Old Highway , Unit 1, Tavernier, F lorida 33037.

Respondent is a " dealer " as defined in section 212.06(2) and is

required to comply with chapter 212.

3. Respondent holds Certificate of Registration number 54 -

8013269710 - 0 issued by the Department . A certificate of

registration is required in order to do business in the state of

Florida and authorizes its holder to collect and remit sales tax

pursuant to c hapter 212 .

4. The Department is authorized to revoke a dealer ' s

certificate of re gistration for failure to comply with state tax

laws. Prior to such revocation, the Department is required by

statute to schedule a conference with the dealer. The dealer is

required to attend the informal conference and may either present

evidence to re fute the Department ' s allegations of noncompliance

or to enter into a compliance agreement with the D epartment to

resolve the dealer ' s failure to comply with chapter 212.

5. The Department issued and recorded warrants in the

public records of Monroe Count y to secure collection of

delinquent sales and use tax, plus penalties, filing fees , and

interest from Respondent. 1/

6. The Department initiated the process of revoking

Respondent ' s Certificate of Registration by sending Respondent a

Notice of Conference on Revocation of Certificate of Registration

(Notice of Conference). The Notice of Conference advised that

the informal conference would be held on August 29, 2013, and

that the Department had initiated the process to revoke

Respondent ' s Certificate of Re gistration for failure to remit

sales and use tax and pay the reemployment tax that was

determined to be due. The notice also informed Respondent that

it would have the opportunity to make payment or present evidence

to demonstrate why the Department shou ld not revoke Respondent ' s

Certificate of Registration.

7. Respondent ' s P resident and R egistered A gent, Spencer

Slate, attended the informal conference on behalf of Respondent

and entered into a Compliance Agreement with the Department.

During the inform al conference, Mr. Slate admitted to using the

collected tax to pay for Respondent ' s payroll, fuel, and other

business expenses instead of remitting the tax to the State.

8. The Compliance Agreement states that due to Respondent ' s

failure to timely file r eturns and pay all taxes due, Respondent

admits to a past due sales and use tax liability of $51,506.55,

consisting of tax, penalty, interest , and fees. The Compliance

Agreement requires Respondent to make a down payment of $16,349.14

by August 29, 2013, and to make 12 monthly payments. The

Compliance Agreement also provides that:

IN CONSIDERATION for the Department refraining

from pursuing revocation proceedings at this

time, the taxpayer agrees:

* * *

C. To accurately complete and timely file

all required returns and reports for the next

12 months, beginning with the first

return/report due for 08/31/2013, payable on

or before 09/20/2013 .

D. To timely remit all taxes due for the next

12 months, following the date of this

agreement.

9. Resp ondent made the down payment of $16,349.14, as

required by the Compliance Agreement , and the first four scheduled

payments, but defaulted on the terms of the Compliance Agreement

as follows:

a. Failed to make the monthly payments due, beginning with

the f ifth payment.

b. Failed to timely remit taxes due for September 2013,

October 2013, and November 2013. In addition, the payment for

sales tax due September 2013 was returned due to insufficient

funds.

c. Failed to timely file sales and use tax returns and remit

the taxes due for the tax periods May 2014, June 2014, and

July 2014.

10. The Compliance Agreement provides that " [i]f the

taxpayer fails to comply with any obligation under this agreement,

the Department has the right to pursue revocation of th e

taxpayer ' s certificate of registration. "

11. As provided by the Department ' s revocation worksheet

dated December 5, 2014, Respondent currently has an outstanding

sales and use tax liability in the amount of $67,501.98 and

reemployment tax liability of $ 667.08, including tax, penalty,

interest, and fees.

CONCLUSIONS OF LAW

12 . The Division of Administrative Hearings has

jurisdiction over the subject matter and the parties hereto

pursuant to sections 120.569 and 120.57(1), Florida Statutes

(2014) .

1 3. Th e Department has the burden of proving by clear and

convincing evidence the allegations in the Amended Administrative

Complaint on which the Department relies to seek revocation of

Respondent ' s Certificate of Registration. Dep ' t of Banking &

Fin. v. Osbor ne Stern & Co. , 670 So. 2d 932, 935 (Fla. 1996).

14. Before engaging in or conducting business in this state

as a " dealer " under chapter 212, Respondent was required to, and

did, obtain a certificate of registration from the Department.

§ 212.18, Fla. Stat.

15. As a dealer, Respondent is required to collect the tax

imposed by c hapter 212 at the time of making the sale from the

purchaser. § 212.06(3), Fla. Stat.

16. In accordance with sections 212.15(1) and (2), the

taxes imposed pursuant to c hapter 212 become S tate funds at the

moment of collection, and the intentional failure to remit these

taxes constitutes theft of S tate funds.

17. Respondent is required to file tax returns and

remit the taxes due with the Department on a monthly basis.

§§ 212.11 (1)(b) & 212.15, Fla. Stat. The tax is due on the first

day of the succeeding calendar month and is delinquent on the

21st day of such month. § 212.15(1), Fla. Stat.

18. Respondent failed to timely file the required returns

and remit sales tax due as re quired. The Department filed

warrants against Respondent to secure outstanding liabilities

resulting from Respondent ' s failure to remit taxes due.

19. The Department is authorized to revoke Respondent ' s

Certificate of Registration due to Respondent ' s fai lure to timely

file the required returns and remit sales tax due as required by

c hapter 212. § 212.18(3)(e), Fla. Stat. The Department may also

revoke a dealer ' s c ertificate of r egistration if the Department

has filed a warrant, notice of lien, or judgm ent lien against a

dealer. § 213.692, Fla. Stat.

20. In accordance with section 212.18(3)(e), the Department

proceeded to revoke Respondent ' s Certificate of Registration

after conducting an informal conference with Respondent and

entering into a Complian ce Agreement with Respondent to provide

Respondent an opportunity to satisfy the outstanding liabilities.

Respondent defaulted the terms of the Compliance Agreement by

failing to make the agreed payments and by failing to timely file

tax returns and remi t the amount of tax due for the subsequent

12 months.

21. Late payment constitutes a material breach of the

Compliance Agreement. In addition to not timely filing the

required returns and remitting the tax due for the 12 months

following the execution of the Compliance Agreement, Respondent

continues its noncompliance by not timely filing the returns and

remitting the tax due.

22. The Department followed the procedure as provided by

section 212.18 to revoke Respondent ' s Certificate of

Registration. Resp ondent defaulted on the Compliance Agreement

and continues to violate c hapter 212 by not timely filing the tax

returns and remitting the tax due. The Department has met its

burden in providing clear and convincing uncontested evidence in

support of the al legations in its Amended Administrative

Complaint to revoke Respondent ' s Certificate of Registration.

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law, it is RECOMMENDED that a f inal o rder be entered by the

Department of Revenu e revoking the Certificate of Registration

issued to and held by Respondent.

DONE AND ENTERED this 30th day of January , 2015 , in

Tallahassee, Leon County, Florida.

S

MARY LI CREASY

Administrative Law Judge

Division of Adm inistrative 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 30th day of January , 2015 .

ENDNOTE

1/ The tax warrants filed in Monroe County are as follows:

Book/Page Date Recorded Amount

2703/2092 09/19/2014 $12,712.97

2671/159 02/12/2014 $5,599.22

2669/960 01/03/2014 $19,835.30

2631/1266 06/03/2013 $32,409.31

2612/836 02/0 7/2013 $17,084.77

COPIES FURNISHED:

Amy L. Mattern, Esquire

20/20 Tax Resolution

Suite 400

11800 Ridge Parkway

Broomfield, Colorado 80021

Angel Eason, Esquire

Office of the Attorney General

Plaza Level 01

The Capitol

Tallahassee, Florida 32399

(eSe rved)

Nancy L. Staff, General Counsel

Department of Revenue

Post Office Box 6668

Tallahassee, Florida 32314 - 6668

(eServed)

Marshall Stranburg, Executive Director

Department of Revenue

Post Office Box 6668

Tallahassee, Florida 32314 - 6668

(eServed)

NO TICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions within

15 days from the date of this Recommended Order. Any exceptions

to this Recommended Order should be filed with the agency that

will issue the Final Order in this case.