texas state sales audit

[ACS]

Texas

I was notified by the State Comptroller's office will be doing an audit of my sales tax payments. Since I got the notification, I got several letters/ Ads' from companies that want to represent me at the audit.

I don't think I will need that service, my bookeeper and I looked at the books and taxes paid , and we seem to be in good shape....neither myself or my bookeeper have been invoved or have any state audit experenice.

One company, I did decided to talk with told me that his company will do a pre-audit, make sure I have all the paperwork ready when the auditor arrives, will inform me of the any possible problems, explain the states policy and proceedures. as well as what to say and what not to say to the auditor.

Would having a service to assist me with a pre-audit a good ideal?

Thank you.

 

[abezon]

It depends on how much the service will cost, how much of those services you can get for free from the library/state dept of revenue, or your bookkeeper, and how much money you have at risk. The money at risk is the largest deficiency you think the state auditor could find. If you reported every penny of gross sales & claimed no deductions & collected/remitted the correct % (which may vary from among cities & countioes), you're fine on sales tax.

Another big audit target is use tax. You owe use tax any time you buy equipment for your own business OR PERSONAL use from another state and do no pay TX sales taxes voluntarily. Common examples would include buying car parts from a mail order catalogue in Wisconsin, buying something via the net without paying TX taxes, etc. If you pay out of state taxes (drive to OK & buy something, paying OK taxes), you get a credit against your TX use tax equal to the taxes you paid OK. While most states don't have time to audit individual taxpayers for use tax compliance, many will roll a personal use tax compliance check into a business sales tax audit. You'll want to try to keep the personal use tax stuff out of the audit. (Possible if you're incorporated.) Clear as mud?