The sales and use tax audit could possibly be one of the biggest challenges that a business will face. If a business has been chosen for an audit, the owner is tasked to prove that he submitted the correct amount of sales tax to his state Department of Revenue (DOR) agency.
Atlanta, GA -- (SBWIRE) -- 08/19/2014 -- Business owners can feel secured and confident about his awaiting sales tax audit if he’s equipped with the right documents that are properly organized. An Established Atlanta Accounting Firm releases the following tips to help business owners prepare for the dreaded sales tax audit.
Organize the records properly:
Business owners might have remitted more to one's state DOR agency and the auditor will evaluate the validity and accuracy of the amount. The auditor will require one to show his sales tax returns, excise tax returns, documentation for use tax, retail sales tax, business and occupational tax and all critical records related to the business. The sales transactions will also be evaluated, so keep efficient documentation to support the individual transactions and be sure they are readily accessible to the auditor. A sales tax software solution will be helpful if a business doesn’t have an efficient way to restore and retrieve records, the software will automate the task.
Patience is a Virtue, Don’t Rush the Process
Sales tax audits can be tiresome and time-consuming for the auditor will do a comprehensive audit and detailed examination of the business’ sales records. It’s a must to have the transactions properly documented this will save both party’s time. If applicable, don’t forget to have the cash register tapes ready and/or the exemption certificates for the audit. DOR authorities are aware of the untapped sales tax revenue available and they are closely inspecting businesses that have not been managing their customers’ and/or vendors’ sales tax exemption certificates.
Seek the Help of a Professional for Sales Tax Audit Defense
It is difficult to envision a more tedious, costly and non-productive process than the sales and use tax audit. And depending on the business owner’s confidence level and knowledge on the audit process and the records he keeps, he may opt to seek the counsel and services of a sales tax audit defense expert who’s well versed in computing sales tax rates and organizing paperwork for tax audits. The counselor would organize all needed files for sales tax audit to be easy and have it done quickly and efficiently. They will also give pieces of advice and guidance about any pending problems concerning the audit.
Latest changes in sales tax have put certain businesses at a higher risk of sales tax audits.
Aside from to the tips below that an Established Atlanta Accounting Firm has release, businesses should pay special attention to where they have nexus, or the obligation to collect and remit sales tax. If one’s business has nexus in a state, and fail to pay tax there, auditors from that state can charge penalties and interests against the business owner for the delinquent taxes.
About Interstate Tax Strategies, P.C
When it comes to Atlanta tax services, Interstate Tax Strategies, P.C. is unique in its exclusive focus on interstate sales and use tax. Ned Lenhart, CPA, is President of Interstate Tax Strategies and has been perfecting his tax consulting skills for over 27 years. He started Interstate Tax Strategies, P.C. in 2003 after serving as a Firm Director for Deloitte in its Atlanta office. Prior to joining Deloitte in 1994, Ned was a Sr. Manager with Arthur Andersen in Kansas City, Missouri. Ned also worked for the Missouri Department of Revenue where he was the Director of the Compliance Division and led the state's civil and criminal tax enforcement efforts. He also served as Deputy Director of the Division of Taxation and Bureau Manager for the Compliance Division.