Are you searching for proven California sales and use tax audit representation? Have you received notification of a California sales and use tax audit by the California Department of Tax and Fee Administration (CDTFA)?
Key Takeaways for Those Looking for Proven California Sales and Use Tax Audit Representation:
- California sales and use tax audits are among the most demanding examinations a business can face.
- If your business sells tangible personal property in California, you are generally required to collect and remit California sales tax. Likewise, if your business purchases tangible goods outside of California, does not pay California sales tax at the time of purchase, and then places those items into commercial use within the state, California use tax may be owed.
- A CDTFA audit can be highly intrusive and time-consuming. Businesses are often required to produce extensive financial and accounting records.
- Sales and use tax audits are not simply exercises in how you conduct business or manage the process of accounting. They are serious investigations that can result in legal proceedings with genuine business and financial consequences.
Proven California Sales and Use Tax Audit Representation
California sales and use tax audits are among the most demanding examinations a business can face. The California Department of Tax and Fee Administration (CDTFA) is responsible for administering and collecting sales and use taxes throughout the state. Its audits are designed not only to test whether tax was paid, but also whether it was calculated, reported, and documented correctly over time. For businesses under review, proven California sales and use tax audit representation from experienced tax attorney Janathan L. Allen and the accounting professionals at Allen Barron is essential to protect financial interests and avoid unnecessary exposure.
If your business sells tangible personal property in California, you are generally required to collect and remit California sales tax. Likewise, if your business purchases tangible goods outside of California, does not pay California sales tax at the time of purchase, and then places those items into commercial use within the state, California use tax may be owed. These obligations apply regardless of intent, and misunderstandings are common—even among businesses that believe they are compliant.
Why Sales and Use Tax Audits Are Challenging
Sales and use tax audits are not limited to reviewing a single return or transaction. The CDTFA typically examines records across multiple reporting periods to identify patterns, inconsistencies, and omissions. Even minor errors will compound over time, leading to significant consequences.
Your CDTFA Sales and Use Tax audit will usually focus on whether the business properly classified transactions, correctly applied exemptions, and maintained adequate documentation. Because the rules are technical and fact-specific, businesses frequently discover exposure during an audit that was not apparent during routine compliance.
What the CDTFA Commonly Requests During an Audit
A CDTFA audit can be highly intrusive and time-consuming. Businesses are often required to produce extensive financial and accounting records, including:
- General ledger reports
- Inventory records and analyses
- The process to determine Cost of goods sold (COGS)
- Sales invoices and purchase receipts
- Bank statements and reconciliation records
Responding to these requests while continuing to operate the business can be overwhelming. Without the experienced guidance of the integrated business professionals at Allen Barron, businesses risk over-disclosure, inconsistent responses, or errors that expand the scope of the audit.
The Importance of Proven California Sales and Use Tax Audit Representation
Sales and use tax audits are not simply exercises in how you conduct business or manage the process of accounting. They are serious investigations that can result in legal proceedings with genuine business and financial consequences. Statements made to auditors, documents produced, and positions taken during the audit can affect assessments, penalties, and future enforcement.
The proven California sales and use tax audit representation of Janathan L. Allen, APC, and Allen Barron Inc. allows your business to place an experienced, proven tax attorney between your company and the CDTFA. This representation helps ensure that communications are handled carefully, requests are properly scoped, and issues are addressed strategically rather than reactively.
Just as important, legal representation preserves the protections of the attorney-client privilege, which does not apply to communications made directly between a business and the taxing authority or to communications with non-legal advisors alone.
Comprehensive Representation Before California Tax Agencies
The San Diego tax attorneys at Allen Barron provide audit defense representation to California businesses facing sales and use tax audits, as well as audits and inquiries from other state agencies, including the Franchise Tax Board (FTB) and the Employment Development Department (EDD).
This integrated approach combines legal strategy with deep tax and accounting knowledge. By managing the audit process from start to finish, counsel can reduce disruption to daily operations while limiting assessments, resolving disputes, and protecting the business from expanded exposure.
Keeping the Focus on Your Business
A CDTFA sales and use tax audit demands time, attention, and precision. Without effective, integrated representation, business owners often find themselves pulled away from running the company to respond to document requests, answer questions, and manage deadlines.
With the proven California sales and use tax audit representation of Allen Barron, those burdens can be shifted to experienced professionals who understand the audit process, the law, and the practical realities of dealing with California taxing authorities. This allows business owners to remain focused on operations while their financial interests are actively protected.
Taking the Next Step
Sales and use tax audits are rarely resolved quickly or casually. Early, informed representation can make a meaningful difference in outcome, cost, and stress.
If your business is facing a CDTFA sales or use tax audit—or expects one—securing proven California sales and use tax audit representation from Janathan L. Allen, APC, and Allen Barron is one of the most effective steps you can take to protect your business and its future.
Learn about the protections of the attorney-client privilege and how Allen Barron can take full responsibility for handling all communications with the CDTFA while representing you in a California sales and use tax audit. Many of the forms requested by the CDTFA are related to your accounting system, such as a general ledger report, inventory analysis, cost of goods sold (COGS), as well as all receipts, invoices, and bank statements. The audit is quite time consuming, and you should not be forced to keep the focus off of running your business while protecting your financial interests during a CDTFA California sales and use tax audit.
If you are searching for proven California sales and use tax audit representation we invite you to learn more about the integrated tax, legal, accounting and business consulting services of Allen Barron and contact us or call today to schedule a free consultation at 866-631-3470 to discuss the audit, and all we can do to save you money and protect your financial interests.
