Avoiding and Correcting Sales Tax Notices

Have you recently received a sales tax notice from a tax jurisdiction? That’s never good news. It means your company isn’t doing something it should be doing and might face fines and back taxes on sales. When tax jurisdictions send out sales tax notices, they often assume non-compliance until action is taken by your company. What should you do if you receive a sales tax notice? The first step is to make sure the notice is valid. Read through the information in the notice to figure out what the taxing jurisdiction is claiming. It can be something as simple as a late filing or could be something as drastic as your neglecting to register for sales tax permits in a tax jurisdiction. Look through your records and compare them to the authority’s notice. The next step is to take actions to remedy the situation.

Don’t wait on your response— it is essentially a red flag to the taxing jurisdiction if you wait extended amount of time. It can be simple. If a tax jurisdictions claims you never filed a return, a confirmation number will clear it up. Sometimes you might need to speak with a tax attorney if it’s a bigger issue to find out the best course of action. While small businesses might not want to pay for the cost of an attorney, they can help defined erroneous assessment. Keep in mind, that not all assessments are the true value of the error. It is a proposed value. The cost of an attorney can be a good investment in the security of your business. After you resolve the conflict with the tax jurisdiction, it’s not over. Your business needs to take steps to resolve the issue, moving forward. Anything other than a clerical error on the part of the tax jurisdiction can be corrected on your end.

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