It’s great to have a business and doing well. You’re proud and moving forward in the belief that you know everything you need to about sales tax law. You skim over the wayfair sales tax case so you have a more sophisticated understanding of what you can and can’t do.

Your sales team is reporting taxes according to the sales tax nexus guidelines and then it happens, you’re stuck in the middle of a sales tax audit. It feels like a death spiral, but it’s an illusion. Why? You can empower yourself and your business with knowledge on what to do after they have notified you of an audit.

Get Organized

The paperwork you must have in order is listed below. It’s the key to your seamless trip through your audit and the sales tax law.

Main ledger and notations.
Make it easy for the auditor to pinpoint what they need to find.
Sales and purchase invoices and journals.
Exemption and resale documents
All your tax returns for the years or quarter they’re asking for.
All financial statements
Bank statements
Depreciation documents.
If applicable, sales tax returns and shipping documents

Use a sales tax calculator for any formulas in question. We strongly suggest double checking. When dotting your I’s and crossing your T’s you can never be too cautious.
They will provide you a list with the notification so don’t worry too much ahead of time. Just know of anything you don’t have and get on it now.

Fix Documentation Issues

You may find issues in the documentation on the aforementioned list and the one they provided you. Scan and fix any issues that may have shown up by a change in your computer software or other reasons; we must rectify any documents that are incomplete or missing.

The point of this is to make sure the auditor can trace everything they need to. If you can’t find certain records or you do things unlike other businesses of your type, then you need to communicate this. You need to show what you do, how you do it and why it’s done that way and how you document your business operations.

Bottom Line of Electronic Records

When you have a business, by which sales income is global or at least within the US online and physical, the sales tax nexus comes to life. The auditor wants to see the password protection, access control, data access controls, data encryption, etc. You must have iron-clad ways of protecting data from corruption for obvious reasons.

When you perform a data inquiry, they need to know what information is retrieved and by whom. Do you have a manual that shows the system operations? This is all helpful to the sales tax audit.

Organize Sales Tax Deduction

Your sales tax deduction must be in order. The wayfair sales tax case sales tax case is a great resource to look at for understanding your online sales tax expectations. Your online, out of state sales must have the same organization and burden of proof of authenticity.

Sales Tax Outsourcing

If you’re a new business; are just coming into online transactions or if your business is just more complex, you may want to consider sales tax outsourcing. Allow professionals to prepare and file your taxes for you and advise you when an audit arises. Sometimes you need more than the sales tax calculator.

Tax audits can really ruin the feel good part of your business. But, you can avoid it with organization and services from the right tax professionals