AI Generated Opinion Summaries

This summary was computer-generated without any editorial revision. It is not official, has not been checked for accuracy, and is NOT citable.

Facts

• In 1996, Mr. Casias registered his business, Casias Trucking, as a sole proprietorship and later, on the advice of his CPA, reorganized it into a limited liability company (LLC) in 2003. Despite this reorganization, Casias Trucking did not update its registration with the New Mexico Taxation and Revenue Department to reflect its new LLC status and continued using the original Combined Reporting System (CRS) number. An audit by the Department for tax years 2006 through 2011 resulted in an assessment of $206,292.02 in taxes, interest, and penalties, identifying Casias Trucking as a sole proprietorship. Mr. Casias entered into an installment agreement with the Department, admitting liability for the assessed amount, but later contested the assessment and the subsequent tax lien, arguing that the liability should rest with Casias Trucking LLC, not him personally (paras 2-11).

Procedural History

• [Not applicable or not found]

Parties' Submissions

• Protestants-Appellants: Argued that the tax liability should not be imposed on Mr. Casias personally but on Casias Trucking LLC, contending that the Department's registration regulation conflicts with the Limited Liability Company Act.
• Respondent-Appellee: Contended that Mr. Casias failed to establish Casias Trucking as an LLC for tax purposes and, even if it was an LLC, Mr. Casias is personally liable due to voluntarily entering into the installment agreement in his individual capacity (para 13).

Legal Issues

• Whether the Department's registration regulation is invalid due to a conflict with the Limited Liability Company Act.
• Whether Mr. Casias is personally liable for the tax assessment and lien despite his contention that Casias Trucking was reorganized as an LLC (para 13).

Disposition

• The Court of Appeals affirmed the hearing officer’s order, holding Mr. Casias personally liable for the tax assessment and lien (para 23).

Reasons

• The Court, per Judge Briana H. Zamora with Judges Julie J. Vargas and Megan P. Duffy concurring, found substantial evidence supporting the hearing officer's decision that Mr. Casias failed to prove Casias Trucking was an LLC for tax purposes. The Court noted Mr. Casias's failure to provide a copy of the articles of organization stamped 'filed' as conclusive evidence of the LLC's legal formation. Furthermore, the Court held that Mr. Casias was precluded from protesting the tax lien because he had withdrawn his initial protest and subsequently entered into an installment agreement admitting conclusive tax liability. The Court applied a presumption that the Department’s tax assessment was correct and concluded that the hearing officer's decision was not arbitrary, capricious, or an abuse of discretion and was supported by substantial evidence in accordance with law (paras 14-22).