- It’s important to correct any sales tax missteps your business may have made.
- If you have established nexus and are not complying with sales and use tax laws, you could owe penalties and interest if caught.
- One option for mitigation is entering into a voluntary disclosure agreement (VDA) in certain states.
- VDAs allow companies to come forward and report taxes owed in exchange for a waiver of penalty and a limited look-back period.
- Refunding tax to customers should only be considered if sales tax nexus does not exist.
- Prospective registration and compliance may be the most logical business decision depending on the tax exposure.
- Remitting taxes collected or tax liability accrued on a current or prospective return leaves the business at risk for penalties and interest under audit.
- Amnesty programs, similar to VDAs, may be offered by states to generate revenue and accelerate collections of outstanding liabilities.
Source: taxconnex.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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