Today's Technology for Tomorrow's Firm.
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February 2015 • www.CPAPracticeAdvisor.com 19 • Te very frst step is geting registered with your state to collect and pay sales tax. Te U.S. Small Business Association provides tax information and registra- tion links for all of the states. ( htps://www.sba.gov/content/learn-about- your-state-and-local-tax-obligations ) • Once you have determined that a tax responsibility exists, and you are registered and have received a sales tax permit, fnd out how frequently your state expects you to make your payments. Penalties will apply if payments are made late. • Determine what sales tax rate to collect in all states where you are doing business. Avalara's Avatax app, downloadable on all devices, is a handy tool for doing this in a hurry. • Prepare your invoicing system so that you can accommodate sales tax on your forms. • Set up a system for keeping track of the sales tax you have collected so that you will know how much you must pay your state(s). • Find out if your state ofers an early payment discount and then be prepared to take advantage of that if it exists. About half of the states provide a discount on your sales tax remission if you pay early. • Determine what sales tax reporting is required by all states in which you are collecting and paying sales tax. Typically some type of reconciliation form is required that shows your taxable sales, the amount of tax owing on those sales, and the amount you have remited. • Your state might provide the opportunity to fle forms and remit taxes online. Go to your state's department of revenue (see link above) to fnd out if this is an option. Sales tax rules are constantly changing and that sit u at ion i s e x pec ted to cont i nue. M a ke s u re someone in your organization is staying on top of legislation (both state and federal) that might afect your sales tax liability and collection process. How and When to Make Sales Tax Payments By Gail Perry, CPA, Editor-in-Chief I f you or your clients are new to collecting and paying sales tax, the process might seem over w helming. Once you have determined that taxable sales are occur- ring, the next step is to prepare yourself for being a sales tax collector and remiter. Here are some tips that should help clear up questions you might have about the process. A Year in the Life of a SALT Accountant is sponsored by Avalara W h e n c c o u n t a n t b y A v a l a r a February SALT Checklist Sales tax rules are constantly changing. Now is a great time to compare new rulings with the business processes of your clients. Find out if your clients are offering any new products for sale. Assess if and where their sales are subject to sales tax. Are your clients making sales in any new states? If so confrm if nexus exists and set up sales tax registrations where necessary. Make sure your clients are remitting their sales tax on time in order to avoid late payment penalties. Make sure your clients are taking advantage of all available early payment discounts. Some states require online fling. Check the rules for all states where tax is owed.