Frequently Asked Client Questions
I am being or have been audited. What can you do?
We provide sales and use tax audit representation services tailored to your specific needs. These services range from turnkey audit representation to a limited review of findings. Because sales tax auditors are generally paid to assess tax rather than give refunds, we maintain a dual strategy throughout the audit process. First, we minimize the assessment by focusing on the auditor’s scheduled items. Next, we examine areas not tested by the auditor to identify credits or overpayments which can offset an audit assessment or support a claim for refund.
Have I under or overpaid sales and use tax?
We will perform a credit and refund study independent of an audit and can file claims for refund in any state. Opportunities exist in all industries that pay a large amount of sales tax reimbursement or use tax. Because we perform these studies on a “percentage of recovery” basis, there is no risk to you; if we do not create savings, there is no fee for our services.
What is taxable in my state and other states where I do business?
Regardless of the level of sophistication of a client’s sales tax reporting process, the client still needs to accurately inform the system as to what products and services are taxable in each state. Our taxability study will determine which of the products and services you sell are taxable in any state. We prepare an easy-to-use sales tax matrix supported by research tailored to your specific products. The matrix will be supported by written opinions from states where taxability is uncertain. Our research will also minimize disputes with customers regarding sales tax billing.
Am I required to register in a state?
The nexus requirements for sales and use taxes are much different than for income taxes. In layman’s terms, there are many activities that will not cause nexus (a filing requirement) for income taxes, but will cause nexus for sales tax purposes. We will examine your activities on a multi-state basis, determine your sales tax exposure, and give you the tools necessary to determine whether it makes sense to register and file sales tax returns. We will also enter into anonymous negotiations with a state to minimize the tax due, penalties, and the audit period.
Can I modify a transaction to minimize tax?
While sales tax avoidance is discouraged, sales tax minimization is a taxpayer’s Constitutional right. We have strategies to minimize sales and use tax on a wide variety of transactions, from software purchases, to boats and airplanes, to sales of entire businesses. Key to these strategies, however, is our involvement before the date of the transaction.
Is my company reporting correctly?
Companies typically delegate the sales tax reporting function to clerk level positions. Consequently, high turnover in these positions can create inconsistency in the sales and use tax reporting function. We will examine your reporting process and recommend solutions to correct problems and minimize sales tax exposure. Typical recommendations include in-house training, documenting reporting processes in a sales tax manual, or automating the sales tax compliance function.