Sales Tax Audit Management
Whether your company has just been notified of a sales tax audit or is in the middle of one, our expert consultants can help.
McClellan Davis® consultants have inside knowledge of the audit process, because most of them are former sales tax auditors, supervisors, trainers, or reviewers. Our experts are widely published on the subject of sales and use taxes, and Dan Davis has written two books on the subject: the Multistate Guide to Sales and Use Tax Audits, and the Multistate Guide to Sales and Use Taxation: Construction Industry. (Both books are published by CCH, Inc.)
Our consultants will help you prepare for an impending audit and develop an audit strategy to fit your operations. We’ll work closely with the auditor on your behalf and handle all correspondence from the taxing agency, allowing your business to operate without interruption. If it’s feasible and will benefit your case, we’ll even have the audit transferred to our office.
As the audit proceeds, your assigned consultant will monitor the auditor’s work papers, present rebuttals, and propose adjustments. We will search for refund and credit opportunities overlooked by most auditors. If we’re not satisfied with the auditor’s work, we’ll call in the audit supervisor to resolve the issue. If the supervisor doesn’t offer a satisfactory resolution, we’ll appeal your case to the next level.
Industry: Fixture Manufacturer/Retailer/Wholesaler
Procedural Summary: Managed Audit/Refund Claim
Our firm became involved in this case during the course of the audit process. After being presented with audit working papers which suggested that a tax liability of approximately $2 million was owed to the state, the CEO of the company retained our firm to examine the audit findings. During that review, we recognized that a significant percentage of the reported taxable sales were actually exempt from tax due to a technicality in the law that applied under the circumstances. Although the assigned auditor refused to permit the uncovered credits, we successfully worked with the audit supervisor and district principal auditor to have a refund granted in excess of $500,000.
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