Sales Tax Guided Help
Ideal For:
- Businesses with annual sales of $1M - $3M
- Audits in up to 3 jurisdictions
Why Guided Audit Service?
Perhaps you are not comfortable handling the sales tax audit journey alone and need just a little expert assistance along the way. Our guided approach is designed for those that want to handle the audit process but have a team of experts to assist and answer questions as they arise The guided solution is ideal for growing businesses needing occasional expert advice and support to address specific sales tax challenges.
What You Get:
- Access to expert-designed tools: Comprehensive DIY library of forms, videos, and guides.
- Expert Assistance: Discuss your unique situation with our team of sales tax lawyers, CPAs or sales tax professionals
- Document Review : Submit your records and our team prepares and discusses a customized audit response plan to implement with you along with estimated exposure
- Correspondence with the Auditor: Following your review our team handles all communications with the state revenue agency, including any negotiations, form filing, and correspondence.
- Audit Report Issued: Our team works with you to reduce any liabilities or exposure areas found by the auditor.
Fully Managed Helper
Ideal For:
- Businesses with annual sales of $3 MM - $5 MM.
- Audits in over 5 jurisdictions.
Why Fully Managed Audit Help Services?
Designed for businesses that just want our experienced team to handle the audit process for them from start to finish. Our managed solution ideal for those that want to focus on their business while we focus on the audit project. Using our fully managed solution, we work with your team to strategize and discuss a comprehensive audit plan, implement the plan, and handle all communications with the auditor, while you do what you do best – your business.
What You Get
- Access to expert-designed tools: Still benefit from comprehensive library of forms, videos, and guides.
- Expert Consultation: Consult with our team of sales tax lawyers, CPAs and other sales tax professionals about your sales tax audit
- Communication & negotiation: We handle all communication with state revenue agencies, including negotiations and correspondence.
- Advantages of our Fully Managed Audit Service Include:
- Limit Distractions: Professional assistance manages auditor interactions, letting you focus on running your business.
- Avoid Overproviding Records: Knowing what to share prevents inflated liabilities from unnecessary disclosures.
- Professional Advocacy: Expert framing of issues reduces audit exposure and improve outcomes.
- Sales Tax Audit Expertise: Our team’s experience with audits, appeals, and litigation ensures informed, strategic handling of your case.
- Tax Collected, Not Remitted: Proper handling of collected but unpaid taxes avoids serious legal and even criminal complications.
- Significant Savings: Our expertise saves time and money by providing accurate documentation, strategic communication, and zealous advocacy.
Enterprise Audit Solution
Ideal For:
- Businesses with annual sales over $5 MM
- Audits in over 5 jurisdictions
- Complex industry issues
Why Enterprise Audit Services?
We have decades of experience handling complex audits for businesses of different sizes and industries. For larger businesses, businesses in complex industries, or nationwide companies, our traditional tiers may not be the best fit. Unlike our competitors, who use a one-size-fits all, cookie-cutter approach, our Enterprise solution offers a comprehensive plan for the intricacies of your business. If you have audits in multiple states or ongoing audit needs for your business, the enterprise solution is likely the answer for you.
What You Get:
- Tailored strategy: Develop a comprehensive plan to address complex audit issues surrounding your unique business
- Dedicated expert team: Work with our sales tax professionals, including lawyers and CPAs, to tackle intricate or high-volume obligations.
- Ongoing communication: We manage all negotiations, correspondence, and meetings with the state sales tax auditor.
- Audit Report: Following the issuance of the audit report, we work with your team to prepare and submit an effective response to the auditor to reduce the liability.
How Our Sales Tax Audit Programs Work
Regardless of which tier you choose, our process is simple and tailored to your business’s needs. Unlike competitors who offer a one-size-fits-all approach, we provide flexible involvement to ensure your sales tax issues are addressed efficiently.
- Discovery & Planning
- Determine the level of assistance you need: DIY, Guided, Managed, or Enterprise.
- Resource Access
- All tiers include access to our comprehensive library of DIY tools, including forms, instructional videos, and detailed guides.
- Document Submission, Preaudit, and Strategy
- Depending on your tier, you utilize our forms, guides and calculators (DIY), submit your documentation to our team to develop a response plan that you can implement (Guided) or that we can handle for you (Managed/Enterprise).
- Document Submission and Correspondence
- For Guided: We offer professional reviews and advice.
- For Managed or Enterprise: We take care of negotiations, correspondence, and submitting the documents with the states. We should know the likely outcome of the submission before the auditor does.
- Audit Report Issued
- Once the state makes its preliminary findings, an audit report is typically issued.
- As part of our DIY and Guided Services, you can utilize our tools to respond appropriately. Under our Managed and Guided solutions, Our team collaborates with you to reduce liability.
- Our team can handle it all for you or provide support when you need it.
Learn More
Nationwide Sales Tax Audit Defense Attorney
Have a Professional Handle Your Company’s Sales Tax Audit
Most states audit businesses for sales tax, sometimes resulting in assessments that can be a huge financial burden on the business. These sales tax assessments often go unchallenged because the business owner or in-house accounting personnel are not familiar or experienced with the sales tax laws that could reduce the sales and use tax liability of the business. As a result, many businesses are overpaying astounding sums to their state.
State use tax issues for certain types of businesses are more robust. For example, businesses that are in construction or real property improvement industries have low exposure on the sales side of an audit, but often have a very high potential for exposure on the purchase side. Most items purchased and installed into the real property are often taxable to the business, and in many industries, normally nontaxable services, like labor, may be subject to use tax. For the uninformed business, a large assessment of its purchases can put them out of business.
The panic of a state sales tax audit often begins by receiving that dreaded phone call from a state sales tax auditor. Usually, after the inquiry phone call and formal notice is issued, a state sales tax auditor can audit 3-4 years of business activity from when a return was filed; they could possibly go back to the inception of business if a state sales and use tax return was not filed. The slightest error, when multiplied over 3 years, can add up to a considerable amount of sales tax liability. These audits are often triggered by seemingly insignificant things like not having the correct paperwork.
Reasons Why Business Owners Overpay State Sales Tax
Our skilled team of sales and use tax experts have found that there are 3 main reasons why businesses overpay state sales tax rather than appropriately challenging the assessment:
- They do not have a sales tax expert handling their audit and they assume their accountant or CPA can take care of it.
- They do not know if the assessed amount is incorrect.
- They think they cannot afford a sales tax attorney or sales tax expert.
What to Expect During A State Sales Tax Audit
Notice from Department and Meeting Request
A state sales tax audit begins with a notice from the Department of Revenue or state revenue agency. From there, an initial meeting is set to discuss the nature of the business that has been audited. From there, the state sales tax audit examination begins.
Audit Plan & Examination
After an audit plan is developed, the auditor will perform an examination by comparing the taxpayer’s books and records to the items reported on the state sales tax return. Upon completion of the examination, the state sales tax auditor will issue a report with sales and use tax adjustments. It is important to know that you have the right to have a sales tax consultant, sales tax attorney, or other sales tax professional represent you during your audit by completing a power of attorney form.
Examining Your Sales During a State Sales & Use Tax Audit
Unlike a federal tax audit, a state sales tax audit is a tedious and exhausting process, to say the least. The state sales tax auditor’s goal is to find your business’s skeletons in the closet. There will be disagreements with the auditor as to whether they are entitled to documentation or not, whether certain transactions are taxable, where the audit takes place, and how long the auditor has at that location to do the audit.
While many business owners, sales tax attorneys, and CPAs believe that the state can do as they please and push your business around, they cannot. A competent and experienced sales tax professional knows when and how to push back and when to tell the state no. During a sales tax audit, the auditor will request a wide range of documents. It is critical to have a state sales tax professional on your team to determine which documents the auditor is entitled to and which they are not.
For example, the auditor will first determine whether all sales or gross sales were reported on your sales tax return. Often, the auditor will compare your sales tax return to a control document like bank statements or your federal tax return. This will allow them to make sure all sales were reported. The tax auditor will also make sure you can provide proof on your exempt sales. In general, the auditor can review the last 3-4 years during the tax audit.
Examining Your Purchases During a State Sales & Use Tax Audit
Most people are surprised to learn that a state sales and use tax audit involves an examination of your business’s purchases as well. On the use tax side, the auditor generally checks to make sure you properly paid tax on items used or consumed by the business. Despite publications and tax lawyers’ advice to the contrary, if a business buys an item online without paying state sales tax, the business has an obligation to remit use tax. Along with untaxed purchases of equipment, this can result in shocking results for the unsuspecting taxpayer.
Upon completion of the audit, there will usually be an exit conference with the auditor. The purpose of the exit conference is to review the work papers. It is advisable to have a tax professional present during this meeting. Eventually, the audit will culminate in a report of field audit or a report of the investigation that summarizes the findings.
Post Audit & Exit Conference Process
Following the state sales and use tax audit, if you disagree with the adjustments that cannot be resolved with the auditor, a notice of proposed determination, or similar notice, is issued. It is critical that if you wish to protest the notice, you must do so within a short timeframe, often 30 to 60 days. After filing, the Department of Revenue or state revenue agency will review and either withdraw the assessment, request additional information, or schedule for an informal conference. If you do not agree with that decision, you can generally file for reconsideration with the agency or appeal the decision to tax or administrative court. While it is not required, it is often advisable to have an attorney handle your case in administrative court.
Find the Right Sales Tax Solution for Your Business. Register for free to Get Started!
