Most of you look to us for advice and planning on your income taxes. If you are a small business owner that operates or does business in Minnesota, there is a trend of which we feel you need to be aware; an increased number of sales tax audits.
It’s likely we just lost the interest of many of you. You might be thinking “I don’t sell products, so I don’t have to worry about sales tax” or “I charge all my customers sales tax and pay it when I’m supposed to, so I’m covered.” What we’re finding as we help clients navigate the new, more intense sales tax audits, is that this might not be the case.
The sales tax in Minnesota is extremely complex, in some cases more so than the income taxes we routinely handle for you. We still want you to be aware of the increased number and scope of audits.
Below is a link to a recent Twin Cities Business article entitled “The $100,000 Shakedown”. It is a great summary of the sales tax audit process endured by one business, and how she came to resolve the audit. We encourage you to read it, and consider how you would defend your own business in such a situation.
If you have any questions, we’d be glad to answer them for you. With the proper awareness, planning, and representation, the ever growing possibility of a sales tax audit will likely seem less daunting.