Blog

Home » Tax » The Secret Tax you Pay every Day that Could Kill your Business

The Secret Tax you Pay every Day that Could Kill your Business

sales taxBondage

“Remember this: debt is a form of bondage. It is a financial termite.” – Joseph B. Wirthlin

Challenge

Taxation is a big, big world.  You’d be amazed at what we tax.  We tax things that you didn’t even thing we’d tax.  We tax liquor, playing cards, cigarettes.  We tax income, payroll, and inheritance and estates.

We taxes sales.  States tax sales on the final customer – which is very different than in Europe where they tax each bit of value added.  States don’t tax you – the seller.  You pay this tax every day, with every cup of coffee and with every bottle of water

The states place on you – the seller – a fiduciary responsibility to collect those taxes.

Yes, that is correct – you are fiduciary to the state.  And when you breach that duty, the state gets really angry.  The state will seize your funds.

The state may make you post a bond to ensure your future good compliance.

Sales tax collection problems are an avoidable problem.

A business needs to keep good records of sales of the goods and services.  Sounds like a lot?  Well, it’s the perfect opportunity for someone to invent some kind of electronic system to help you, the simple business owner.

Oh wait, there’s a whole industry that does this for us now.  Companies like Square and Intuit and Lightspeed have complete systems for the management of inventory and your cash register.  A good article discussing a few of these Point of Sale (POS) (no, I am not kidding, they are called POS systems) systems can be found here.

These systems will – to a greater or lesser extend – manage inventory, record sales, and prepare sales tax reports.  Those sales tax reports can then be submitted to the state with payment.

Solution

Charm.  I’d like to tell you that we here are Brinen & Associates are the masters of taxation ju-jitsu.  I’d like to tell you that we are the master from whom the taxing authorities cannot take the pebble from our palm.

Sometimes, you just need to be nice.  Fall on your sword, admit your client is an idiot, that they should never have let this matter get this far, and beg.

Results

The bond requirement got waived.

PRACTICE AREAS

RECENT POSTS

No Results Found

The page you requested could not be found. Try refining your search, or use the navigation above to locate the post.