Oakland California Sales Tax Attorney + CPA
There are numerous situations that can subject a business entity to the regulations controlling the imposition of sales tax in California. For example, you may be responsible for paying sales tax if you sell or store products in California (i.e. utilize an Amazon fulfillment center in California), employ workers who install products or conduct sales in the state of California, or if you lease commercial equipment within California’s boundaries. If you belong in any of these categories, you should discuss your California sales tax responsibilities with an experienced business tax attorney or CPA in Oakland, like one of the award-winning tax professionals here at the Tax Law Office of David W. Klasing.
Led by Oakland tax attorney and CPA David W. Klasing, who has more than a decade of auditing experience in addition to years of experience practicing tax law, our office is supported by a dedicated team of California sales tax audit lawyers, CPAs, and EAs who are qualified to handle both state and federal audits, in addition to any resulting appeals or tax litigation. Our corporate tax lawyers wield a sophisticated understanding of the complex sales tax regulations that apply in California, which we utilize to the benefit of corporations, partnerships, limited liability companies, and sole proprietorships. Whether you need help navigating your sales tax duties, preparing for a sales tax audit, or disputing the results of an audit, look to the Tax Law Office of David W. Klasing for support you can trust.
What is California Sales Tax?
In addition to income taxes, payroll taxes, and employment taxes, business owners must also contend with California sales taxes, which are collected and enforced by the California Department of Tax and Fee Administration (CDTFA), a relatively new organization that was established in 2017. The CDTFA assumed many of the duties that were formerly managed by the California Board of Equalization (BOE), including those pertaining to sales tax collection – and sales tax auditing of businesses.
As the CDTFA explains, “Retailers engaged in business in California must register with the [CDTFA] and pay the state's sales tax, which applies to all retail sales of goods and merchandise except those sales specifically exempted by law.” This also extends to out-of-state purchases made online especially in light of the recent U.S. Supreme Court in Wayfair.
Why Was My Small Business Chosen for a Sales Tax Audit?
As is true of other tax audits, there are many triggers that can give rise to a sales tax audit. In fact, this statement is arguably truer today than at any time in California’s recent past. Since superseding the BOE, the CDTFA has ramping up the number of sales tax audits that are conducted in California – in part due to a recent Supreme Court ruling that gave California (and other states) broader authority to compel internet retailers to collect and remit sales tax, increasing the importance of preparing for the possibility of an internet sales tax audit. Some common examples of sales tax audit triggers in California include, but are not limited to, the following:
- Filing taxes late
- Operating a business within an audit-prone industry (for example, car dealership audits and real estate audits are particularly common)
- Operating a predominantly cash-based business, such as a convenience store, restaurant, pawn shop, liquor store, parking garage, or bar
- Reporting an unusual amount of exempt sales
- Reporting significantly higher business expenses than in previous years
What if I Disagree with the Results of a CDTFA Sales Tax Audit?
During the audit, which is also referred to as an “examination,” the CDTFA auditor will review and compare various sets of records. For instance, the auditor will likely want to confirm that the sales you reported on your business’ books align with the sales you reported on your sales and income tax returns.
While CDTFA auditors are trained to work with precision and accuracy, mistakes can still be made – and in a surprising number of cases, the result is a costly tax bill for your business. However, this does not necessarily need to cause damage to your bottom line.
If you disagree with the results of the sales tax audit, it may be possible to resolve the issue simply by discussing the underlying calculations with an audit supervisor, or with a representative of the CDTFA. If this relatively informal approach fails, you may be able to dispute the findings further by filing a written appeal, once you have received either an Appeals Bureau Decision or Notice of Action from the CDTFA. If filing an appeal with the CDTFA, you must include the following:
- Either a written statement requesting appeals, or a completed version of Form OTA Form L‐01 (Request for Appeal). The acronym “OTA” refers to the Office of Tax Appeals, which was also created in 2017 alongside the CDTFA. Whether you choose to complete the form or prepare a statement of your own, be sure that your argument is as clear, concise, and detailed as possible. Our tax audit appeals attorneys know what the CDTFA looks for in taxpayer requests for appeals, and can help you prepare the strongest submission materials possible.
- Copies of relevant notices you received from the CDTFA.
- Financial documentation that supports your tax argument, such as bank or credit card statements.
California Sales Tax Lawyers and CPAs in Oakland
The state laws and procedural regulations surrounding sales tax determinations, payments, audits, and appeals are among the most complex and challenging to interpret successfully – particularly for taxpayers who are already busy with the daily ins and outs of running a small business. Let the Oakland sales tax compliance attorneys at the Tax Law Office of David W. Klasing manage the legal considerations and audit preparation for you, identifying ways to minimize your liabilities, interest, and penalties while taking steps to maintain or achieve compliance with sales tax laws.
For a reduced-rate consultation about our sales tax services in Oakland, contact the Tax Law Office of David W. Klasing online today, or call our Oakland tax office at (510) 764-1020. You can also contact our main office by calling (800) 681-1295. Please note that all meetings at our Oakland location are by appointment only.
If you have concerns about the privacy of our initial or subsequent communication and are unable to easily travel to our Irvine / Orange County Main Office, consider scheduling a GoToMeeting to safely and securely establish an initial or maintain an existing attorney client relationship. With end-to-end encryption, strong passwords and top-rated reliability, no one is messing with your meeting. To schedule a reduced rate initial consultation via GoToMeeting follow this link. Call our office and request a GoToMeeting if you are an existing client. We are generally happy to travel to any of our appointment only satellite offices for a subsequent meeting in appropriate circumstances once a relationship is established via a signed engagement letter and the payment of an initial retainer or where enough retainer is available where a current client to cover the reasonable travel time and time required for the meeting.
Will it cost me more to hire the Tax Law Offices of David W. Klasing, who’s main office and the vast majority of the firm’s staff is located in Irvine California, but an appointment only Satellite office is close to my location, as opposed to a local company? Absolutely not! See our policies that address this issue here: