News & Publications

In Case You Missed It: Last Week in Allyn Tax News (August 16-20)

Michigan Provides Guidance for Small Business Tax Audits

A tax audit is an in-depth examination of a business’s tax returns for a particular tax type, such as sales tax, typically covering a period of years. An audit is performed in order to verify that the taxpayer in question has properly accrued and paid all applicable taxes for the designated period. Additionally, tax audits may begin at any time for a business and can cover any period within the statute of limitations for that particular state.

Small businesses are advised to not only maintain all data stored computer-based accounting software such as QuickBooks but to also have all original invoices, documents, and additional data that formed the software database. Auditors will typically want to look beyond the software system and review additional records. While the data residing in the computerized accounting system is obviously intended to reflect original data, it does not constitute original data.

Connecticut’s Sales Tax-Free Week is Underway!

Connecticut’s sales tax-free week began on Sunday August 15 and is running through until Saturday August 21st. During the tax holiday retail purchases of most clothing and footwear items purchases under $100 will be exempt from the states sales and use tax. The sales sale exemption applies to all eligible items under $100. Now is the perfect time to purchase those logo-ed clothes to help promote your business!

IT Services In Alabama: Taxable or Exempt?

The Alabama Department of Revenue has ruled that a foreign company is not liable for sales tax on invoices for information services provided to a company with an Alabama location, so long as the nontaxable services are separately stated on all invoices and do not involve the transfer of computer software.

Training, programming, software maintenance, and testing are nontaxable services in AL even when rendered in relation to computer software or along with the transfer of software so long as the services are separately stated on each invoice. Meaning that the additional technology services are nontaxable services and should be separately stated on all invoices. Additionally, the transfer of tangible personal property such as the training handout is merely incidental to the nontaxable training service and is not taxable.

Large Bicycle Company Sued for Wrongful Sales Tax Collection

A class action lawsuit has been filed accusing the bicycle company of collecting sales tax of 6.3% or 8.9% for a digital membership that is considered a tax-exempt “digital good” in several states including New York, Virginia, and Massachusetts. The company has refused to reimburse its subscribers for the sales tax that had been allegedly wrongfully collected before January 1, 2021, when it updated its taxation procedures. If found guilty this would mean that the company collected millions of dollars from its subscribers that had not been remitted to the state and knowingly refuses to refund customers.

Many people do not know that over-taxing customers can be just as dangerous as under-taxing them. Taxation of digital goods and software as a service are complex topics. States have different laws and regulations about what is considered taxable. Our consultants stay up to date on the latest federal, state, and local tax changes and are happy to assist your business in remaining compliant.  

Hawaii Real Property Tax Payments Due

Honolulu county recently issued a reminder to property owners that the first installment of their real property taxes is due by August 23, 2021. The reminder states that payments can be made electronically, by mail or in person. Property owners who fail to make payments on time will be subject to a late penalty of 10%, plus 12% interest per year.

How Can We Help?

Allyn’s tax team is staffed with seasoned tax professionals experienced in all aspects of Federal, multi-state and local tax compliance and consulting for large US and global corporations. We use that experience to your advantage.

Here at Allyn, we pride ourselves on our ability to always “stay on top of it”. We use the latest in tax software and create a unique, rigorous process for each and every client’s needs, ensuring that nothing slips through the cracks. Our team is equipped to assess in-advance and quickly resolve all tax issues that a business may encounter, allowing our clients to confidently focus on what they do best.

Allyn Tax offers a full scope of corporate tax services across North America, encompassing business tax compliance and consulting, audit defense and support, nexus reviews and registrations, exemption certificate management, overpayment reviews, and mail processing solutions.

Contact us and we can provide a customized cost-effective solution to meet your company’s needs. For further information on Allyn Tax services, please contact: tax@allynintl.com.

For More Information

If you are interested in learning more about this topic or other tax topics, please visit our Tax Publications under News & Publications at www.allynintl.com.

Contributor: Courtney Sboro


About Allyn International

Allyn International is dedicated to providing high quality, customer centric services and solutions for the global marketplace. Allyn's core products include transportation management, logistics sourcing, freight forwarding, supply chain consulting, tax management and global trade compliance. Allyn clients range from small local businesses to Fortune 500 firms. Allyn conducts business in more than 20 languages and has extensive experience in both developed and emerging markets. Highly trained experts are positioned throughout North and South America, Europe and Asia. Allyn’s regional headquarters are strategically located in Fort Myers, Florida, U.S.A., Shanghai, P.R. China, Prague, Czech Republic, and Dubai, U.A.E. For more information, visit www.allynintl.com.

 

This website uses a variety of cookies, which you consent to if you continue to use this site. You can read our Privacy Policy for details about how these cookies are used. Manage Cookies