Insider Tips from – Former – Sales Tax Auditor
Are you located in Atlanta, Charlotte, Raleigh or any other state and being audited by The State of Florida Sales Tax.
Are your books and records located in your state other than Florida and you have “Nexus” in Florida?
We can represent companies in all 50 States for Florida Sales Tax Audits.We are Out of State specialists.We can travel to you.
Our former Florida sales tax auditor who has conducted Florida audits in all of these states has insider information that will help you while under a Florida Sales Tax Audit.
Our insider – Former sales tax auditor – can travel to your location or we can have the audit handled at our location in Georgia or Florida.
The state of Florida targets certain industries for audits “they like low hanging fruit” if they think there is easy tax recovery with minimal work hours they target specific industries.
The industry type can be a factor in why they were chosen for an audit – current industries the DOR has targeted for “Low Hanging Fruit”
Which Industries are ” low hang fruit?”
• Hotels
• Restaurants
• Car dealerships
• Convenience stores
• Retail stores
• Manufacturing companies
• Shipping companies
These industries are typically low hanging fruit because all of the available dollars collected from Florida sales tax audits. These companies have a history of being repeated offenders within the state of Florida. As a result, you will find continued audits for Florida sales tax department of revenue.
As a – Florida Sales Tax – Insider I have found major recovery from in these areas, so beware, the auditors will probably be looking here:
• fixed assets
• consumable supplies
• disallowed exempt sales
• unreported income
Also, bars, restaurants and liquor stores that are cash based businesses and cash has a way of getting lost or not reported.
Does your company have Nexus with – The State of Florida?
The answer could be yes, depending on conditions in which business activities occur.
Your out-of-state company with Nexus could be a target of a Florida sales tax audit
Nexus
Nexus in general terms means a connection. The term Nexus is used in tax law to describe a situation in which a business has “Nexus” or presence in a state and thus subject to state sales taxes for sales within that state.
Here are some cases in which a business might have a sales tax Nexus in the state:
• if the business has a physical location in the state
• if there are resident employees working in the state
• if the business has property including intangible property in a state
• if there are employees who regularly solicit business in the state
Nexus for state sales tax purposes has in the past required a physical presence of the taxing business in that state; most recently Nexus has also been invoked in relation to affiliates.
In corporate law and taxes, and the affiliate is a company that is related to another company, usually by being in the position of a member or subordinate role. Two companies may be affiliated if one company has control over the other or if both are controlled via third company.
Your out-of-state company with Nexus could be subject to back taxes
Beware if your out-of-state company is subjected to a Florida State tax audit an assessment will be issued for a three-year audit.
Charging Florida Sales Tax
Businesses who have Nexus and who also sell products in some services are required by the state in which they do business to collect sales tax, at the applicable sales tax rate for that state including local option taxes sales tax rate is separately stated and added to the price of the goods/services by the merchant.
Sales tax is a trust fund tax, meaning that when you collect the taxes you are doing so on behalf of the state and you are required to turn this money back to the state in a timely manner.
ISSUES AN OUT OF STATE BUSINESS COULD HAVE DOING BUSINESS IN – FLORIDA
• commercial rent
• rental consideration
• Fixed assets located in Florida
• consumable supplies used in the Florida locations
Your business that is located in a state other than Florida and when you conduct business in Florida either directly or indirectly you will be subject to the same laws of a Florida-based company for your Florida locations.
You need to be aware that even though your headquarters is out of the state of Florida if you rent any commercial real property in the state of Florida this commercial real property will be subject to taxation in the state of Florida.
Beware the state of Florida imposes a sales tax on all commercial rental property in the state of Florida. I can tell you that as a former auditor many businesses that I audited in Georgia and other Southern states and had other locations in the state of Florida were not aware that real estate when rented was taxable.
Also, companies that had a related company that paid rent to itself were subject to commercial sales tax.
In addition to the rent being taxable, rental consideration such as paying the real estate ad valorem tax on behalf of the landlord is taxable as rental consideration.
When you purchase fixed assets and consumable supplies from vendors outside of the state of Florida and have these consumable items and fixed assets shipped to your location in Florida they are subject to a sales tax and if a sales tax was not charged by the vendor.
The use tax should have been paid to the state of Florida on your sales tax return.
Beware – more than likely these out of state vendors would not have been registered with Florida and would not have charged a Florida sales tax on your purchases.
Remember that any tax liability you have will be for the whole audit period and could amount to a sizable amount of tax, penalty and interest.
We are a full-service tax firm that specializes in federal tax representation and are one of Florida’s most experienced for sales tax audit defense
.
Our staff consists of tax attorneys, certified public accountants, former IRS agents and a former sales tax auditor with over 16 years of direct work experience with the Florida Department of revenue.
Feel free to contact us for initial tax consulting for Florida sales tax audit defense.
We will completely review your case and give you a full assessment of your audit status so you can make an informed and confident decision of how to fully resolve.
Florida Sales Tax Audits – Out of State Taxpayers – Atlanta, Charlotte, Raleigh
