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Let GBQ SALT Take the Sting out of the Sales/Use Tax Audit Wound

February 26th, 2013 by Judd Ballard

Audits are almost certain to increase after the May 1st amnesty date.

Many issues can trigger sales/use tax audits. Even the most conservative taxpayer may receive notices from time to time. Early strategic communication is a critical component to a successful audit resolution. GBQ can assist your company in responding to information requests, communicating with auditors, providing critical analyses of audit schedules and workpapers, negotiating assessment items and liability and representing your company through administrative level appeals.

What types of purchases often cause audit liability?

  • “Cloud” related services (SaaS, IaaS, etc.)
  • Business Fixtures
  • Purchases from out-of-state vendors or on-line purchases
  • Temporary employment services
  • Software licenses and/or hardware purchases
  • P-card purchases

What options do I have if I believe exposure exists?

  • Take advantage – Even if your company has not been contacted for a sales/use tax audit, now is the opportune time to assess your company’s level of compliance with Ohio sales and use tax statutes.  You could also potentially take advantage of Ohio’s Use Tax program, which ends May 1st.  By participating in this program, it is very possible your company could be eligible for waiver of any penalty and interest associated with the use tax due.

What if I’ve already been contacted for audit?

  • Don’t roll the proverbial dice – Even taxpayers who are currently under audit by the Ohio Department of Taxation may participate in Ohio’s Consumer’s Use Tax Amnesty program which ends May 1st.
  • Amnesty is not the only option – Even after the amnesty period ends, Ohio will maintain its sales/use tax voluntary disclosure program which offers similar benefits to the amnesty program including a limited look-back period and penalty waiver.

What should I do next?

  • Pick up the phone – Contact any one of GBQ’s SALT professionals for assistance in identifying potential sales/use tax exposure areas and recommendations on mitigation steps.

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