2012 was a turbulent year in the world of sales tax, and 2013 promises to be just as wild.
With multiple online sales tax bills currently before Congress, and states passing their own so-called “Amazon laws”, it can be tough to keep up with it all. Couple that with the fact that states are expected to continue the trend we saw in 2012 of hiring more auditors in an attempt to maximize their sales tax revenue, and the outlook can appear dark and daunting for a business.
The bottom line is that businesses are more likely than ever to face an audit, and thanks to the increasing complexity of compliance, it is harder than ever to stay on top of all the changes and avoid a negative audit penalty.
Avalara has compiled a list of the top 12 tips every business should know when it comes to sales tax compliance in 2013. Here are some of the topics that made the list:
• Determine if you’ve created nexus in any new jurisdictions in the past year. Nexus laws vary from state to state and can change from one month to the next.
• Make sure you understand taxability of new products you offer. Not only can taxability differ from one product to the next, but it can also differ state to state.
• Verify jurisdictions based on exact location, not zip code. It is not unusual to have multiple jurisdictions (and therefore multiple rates) for a given zip code.
To learn more about these topics and get the full list of pointers to help you become more efficient while reducing your audit risk,