2023 Marcum Year-End Tax Guide

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“Sales tax is a vital revenue source for government services like education and infrastructure.”

• Reduced risk of errors compared to manual calculations. • Scalability to manage growing business complexities. • Simplified tax return filing and documentation, which is helpful during audit. • Cost savings by potentially reducing the need for specialized tax professionals. Overall, sales & use tax software streamlines the sales tax management process, reduces errors, saves time, ensures compliance, and provides greater convenience and accuracy for businesses. Considering a reputable partner in sales and using tax compliance software is instrumental in streamlining the tax compliance process.

PURSUING VOLUNTARY DISCLOSURE AGREEMENTS

Most states offer taxpayers the option to enter the VDA program anonymously, which enables our clients to withdraw from the VDA if they decide not to proceed. Companies must determine tax liability through due diligence when selling their business. VDAs are generally part of the due diligence process to minimize tax liability, which can reduce the business’s sale amount or require the seller to ensure a high dollar amount of escrow to cover this exposure. Marcum LLP’s State and Local Tax professionals have vast experience guiding our clients through the entire VDA process and will address any questions or concerns at any time.

A Voluntary Disclosure Agreement (VDA) is a program offered by tax authorities to encourage taxpayers to voluntarily disclose unreported income, assets, or other tax-related information. It allows taxpayers to rectify mistakes or omissions without facing severe penalties or criminal charges and enables tax authorities to collect owed funds without lengthy investigations. A sales tax VDA allows businesses to voluntarily disclose and pay any outstanding sales or use tax liabilities, with penalties generally waived or reduced depending on whether sales tax was collected but not remitted. Under a VDA, businesses enter into an agreement with the state tax authority to disclose their unpaid tax liabilities for a specified period and agree to pay the outstanding tax liabilities, including interest and penalties.

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