In a nutshell, tax filers should be aware of the sales tax audit procedures in their states to avoid any complication if their firm is picked by the Internal Revenue Services for an audit.
Atlanta, GA -- (SBWIRE) -- 02/27/2015 -- Sales tax audit is one of the hurdles every capitalist has to surpass annually because only few manage to get through every sales tax auditing season without any violations. And it became an imperative task to handle since out of 145 million annual tax returns that are being filed to the Internal Revenue Services, some 47 million of those are self-prepared while others unintentionally face trouble.
The number one solution to prevent costly consequences of filing mistakes and much worry on the audit day is to strictly follow the sales tax audit procedures set in varying states. It guarantees capitalist that they will manage to avoid certain pitfalls of randomized sales tax auditing selection, that one single error could cost thousands of bucks, and worst, face jail time. And since a lot of entrepreneurs nowadays self-prepare their documents for a sales tax audit, the Interstate Tax Strategies, P.C. shares major sales tax errors that could trigger an audit. These are contributions to charity organizations and inaccurate records.
It's not bad to make 1% charitable contributions to any organization of choice especially if this was given a check and a receipt is received from the organization as a proof of the generous contribution. But if, for instance, a capitalist have reported the following year with an increased on the generous contribution bigger than the previous year, it's a red flag. According to the Internal Revenue Services, the charitable contributions' national average is 3% of the Annual Gross Income and inflating it by taxpayers has the possibility for an audit.
Maintaining accurate records of time could also save every capitalist from the troubles that a sales tax audit could create. Whether the Internal Revenue Services has sent a notice for a sales tax audit to the firm or not, maintaining at least the three years worth of the tax returns and records, keeping the checkbook stubs, retaining and organizing the receipts for all the purchases made throughout the year, monitoring cost basis of property and taxable assets, filing all bills in systematized folder and journaling any deductible items in a manner of their occurrence could save the firm and remain be unscathed.
In a nutshell, tax filers should be aware of the sales tax audit procedures in their states to avoid any complication if their firm is picked by the Internal Revenue Services for an audit. Though firms have nothing to hide from their finances, it is inevitable to be worried upon receiving the notification from the random selection. But if capitalist managed to prepare every document needed for a sales tax audit, surely, there's nothing to be afraid of.
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.