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November 2006    • www.salestaxtexas.com

 

What if I don’t agree with the results of my audit?

The Texas Comptroller’s Office recently issued Publication 96-129, “What if I don’t agree with the results of my audit?” http://www.cpa.state.tx.us/taxinfo/taxpubs/tx96_129.pdf. This is a handy, plainspoken guide all Texas practitioners in public accounting should have a familiarity with.

It is imperative to understand the appeals process. The auditor will schedule an exit conference when they believe the field work on an audit is complete. After this exit conference but prior to the Notification of Audit Results letter, any disputed issues may be taken to the auditor’s supervisor or manager for a reconciliation conference. If resolution is not found here, a more formal conference may be requested with a Dispute Resolution Officer.

Once the Notification of Audit Results letter is sent, taxpayer will have 30 days from the date of the letter to request a redetermination hearing by submitting a “statement of grounds”. The statement of grounds should clearly describe the items contested, either individually or by category, and why taxpayer disagrees with the audit results. Once accepted, taxpayer will have 60 days to provide additional documentation to support its contentions.

If the auditor still disagrees with taxpayer, the case will be referred to a hearings attorney. Upon review, the hearings attorney will advise taxpayer whether it agrees or disagrees with taxpayer’s position. If the hearings attorney disagrees, the case may still be taken to an Administrative Law Judge. An oral hearing may be requested with the ALJ. Or, taxpayer may request the case to be decided based upon written submissions. Even after a taxpayer loses at the ALJ level, the case may always be taken to District Court.

With all of the appeals processes, we suggest that if a taxpayer is going to engage a sales tax consultant to assist with the audit, they do so as early as possible. It is generally much easier to get items removed from an audit during the earlier phases rather than the further you go up the appeals ladder.

Have a blessed Holiday Season!

About Sales Tax Specialists of Texas

Sales Tax Specialists of Texas provides sales tax audit defense services to all taxpayers and sales tax refund reviews to taxpayers in the following industries:
 

  • Manufacturing
  • Oil & Gas
  • Residential Communities
    (Apartments and Nursing Homes)
  • New Construction
    (Homebuilders and Non-residential)

     
  • Restaurants
  • Printers
  • Agriculture
  • Golf Courses
  • Janitorial Companies
     

To learn more about Sales Tax Specialists of Texas, visit our website at www.salestaxtexas.com.

To request a consultation, click here to email Sales Tax Specialists of Texas.

Texas Sales Tax Update is published on an as-appropriate basis and is a service of Sales Tax Specialists of Texas.