Resolving Sales Tax Audits and Disputes

If your company has been notified of underpaid sales taxes in any cash business, particularly retail sales, restaurants and bars, the New York tax audit defense lawyers of J&G, LLP, can help you avoid penalties and ensure that any assessments are based on actual sales volumes rather than estimated sales based on spot observations.

Our lawyers work closely with our clients’ accountants to make sure the data necessary to prepare and submit accurate quarterly sales tax returns is available. We also work with managers to develop policies and practices that can help assure the accuracy of register tapes, monthly financial statements, and sales tax returns.

Protecting Business Clients From Overstated Sales Tax Liability

The New York State Department of Taxation and Finance (also known as the Tax Department) will often send field investigators out to observe the volume of business at a restaurant or bar, generally on a busy Friday or Saturday, and compare these impressionistic results with the volume of business reported on a quarterly sales tax return. If there appears to be a significant gap between the reported sales and those projected from an isolated observation, a notice of sales tax audit might very well follow.

In most cases, the business will have sufficiently detailed sales and tax data to allow the audit to go forward on the basis of actual sales figures, which typically demonstrate the soundness of the sales figures shown in the tax return. Sometimes, however, a company’s inadequate record keeping practices will encourage the Tax Department to estimate tax on the basis of observed sales volumes, which will often result in overstated sales tax liabilities.

Our attorneys can protect your business from the risk of inflated tax arrearages through presenting accurate sales data or making the case for reducing the department’s high estimates if records are not available. We can also advise you about maintaining a current Certificate of Authority. Additionally, J&G attorneys can provide reliable advice about special situations, such as reporting and tax obligations for a business acquired as a going concern between reporting periods.

In most cases, we can resolve problems on satisfactory terms through negotiation with Tax Department investigators, auditors and collections officers. When necessary, however, we can represent you in administrative hearings or civil court proceedings.

Experienced Tax Audit Defense Counsel in New York State: Call 845-764-9656 or toll free at 866-303-9595

In addition to representing clients in sales tax disputes, we also work with businesses that need advice about liquor taxes, license violations and underage sales problems. To learn more about the New York sales tax audit defense practice at our firm, contact an attorney at J&G in Walden or Monticello.