Sales and Use Tax Challenges

Sales and Use Tax Challenges

FEATURED

James Lyngholm Practice: Audit Email | Bio

James Lyngholm
Practice: Tax
Email | Bio

Scott McCrillis Practice: Audit Email | Bio

Scott McCrillis
Practice: Audit
Email | Bio

With states continually searching for revenues to aid pressured budgets, state taxing authorities are becoming more aggressive with their sales tax base and taxability determinations resulting in the generation of more audits. Sales and use tax liabilities can be substantial. These taxes average between 7% and 9%. To manage an already complex environment, sales tax planning and compliance is a critical component of a company’s tax department. Unless properly addressed, significant sales and use tax exposure and liabilities can result from any of the following:

  • Sales/use tax processes and systems that have not been updated in many years
  • Personnel turnover and inexperience
  • New product/service offerings and e-commerce
  • Decentralized sales and use tax operations
  • Limited resources/budgets
  • Ever-changing sales and use tax law

 

The MCG Approach

Our firm has expanded rapidly since inception as evidenced by our organic growth and wide variety of service offerings. Our commitment to quality, service and value has driven our success. We have built our firm and our sales tax practice on the strategy to create more value than we charge in fees. MCG believes our expertise and value added approach, coupled with our competitive cost structure, is a winning combination for companies looking for value in the sales tax area.

We have 18 professionals specializing in sales and use tax services. Our professionals represent a different mix of accounting, legal, industry and state government backgrounds. With this experience, we can help your company in its effort to achieve compliance, cut costs, mitigate risks, and effectively address sales and use tax exposure.

Sales and Use Tax Service Offerings

Compliance Services

Operating taxes, such as sales and use taxes, state telecommunication taxes, and alcohol and beverage taxes, are often the most misunderstood and heavily audited areas of state and local taxation. Compliance for these taxes is a time consuming task and can be the source of unexpected tax liabilities or of unanticipated tax savings. It is often difficult to determine if there is a taxable presence in a jurisdiction and if so, if a transaction in itself is taxable.

MCG has experience in handling the sales and use tax compliance function. Several clients enlist MCG as their sales tax department and entrust us with ensuring that applicable sales and use tax laws are handled appropriately. Our objective is to provide these compliance services by the most efficient means possible while providing an outcome that is most favorable to the client.

Refund Analysis

We conduct a thorough review of accounting records with the goal of identifying potential refund opportunities. We are able to maximize potential tax refunds without any excessive burden on the company’s existing infrastructure. We can also provide you with an overpayment study to review both taxes that have been paid to vendors and taxes that have been self-assessed by your company. A refund analysis can also uncover opportunities to improve your sales and use tax processes and potentially prevent future errors.

Audit Representation

We will act as a liaison between you and the auditing state’s representative during the course of the audit. All questions and correspondence from the state will be directed to MCG and we will analyze and respond to such requests appropriately. Our approach often produces unique tax credit opportunities that may be overlooked by traditional accounting firms. When disputes arise, we vigorously defend your tax positions and will appeal to whatever level is economically necessary. No matter where you are in the audit process, it is never too early – or too late – to request our assistance.

Nexus Planning and Voluntary Disclosures

With the growing concern of multi-state taxation for companies that operate across state lines, your company needs to determine if it has nexus within state’s taxing jurisdictions. We can help you with nexus determinations involving physical locations, employees and solicitation of sales involving employees, representatives and agents. If any area of non-compliance for sale and use tax reporting is uncovered, we can attempt to mitigate any exposure by assisting with obtaining a Voluntary Disclosure Agreement with applicable states. We can negotiate with taxing authorities to limit the number of years on which tax will be assessed as well as the waiver of penalties and interest.

Taxability Research

When you have questions regarding the application of sales and use tax to your operations, we can provide you with the answers. Even if you are not selling tangible personal property, you may be providing a taxable service on which you should be collecting sales tax. We can provide taxability matrices or written opinions that detail the research as well.

Abandoned and Unclaimed Property

In today’s environment, even the most sophisticated company is exposed to the risk of either under- or over-reporting its unclaimed property liability. Any inactive property not claimed within one to five years creates a responsibility for the “holder” company, which must remit the unclaimed property to the state. From compliance assessments and audit assistance to estimation techniques, supporting work papers, and comprehensive policies and procedures, our team can handle any unclaimed property compliance challenge that comes your way in the most efficient and cost-effective manner.

 

The MCG Difference

The MCG Sales and Use Tax specialists offer an insightful perspective to your business. We provide:

  • The ability to respond quickly to meet your needs.
  • Engagement team continuity maintained through low firm turnover.
  • Experience with the requirements and nuances of jurisdictions in all 50 states.
  • Professionals with accounting, legal, industry and government experience.
  • A competitive fee structure.
  • Specialists in industries with complex sales and use tax issues, including manufacturing, telecommunications, health care, food and beverage/hospitality, retail and software development and technology.

 

Contact us to learn more today.

 

 

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Montgomery Coscia Greilich LLP
Dallas | Fort Worth | Austin
2500 Dallas Parkway, Suite 300
Plano, TX 75093
(972) 748-0300
info@mcggroup.com

     

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