Business sales tax Texas
Texas does not impose a state income tax, business or personal, so you’ll oftentimes hear national commentators relate to Texas a “tax friendly” state. This is not all of the time the instance. Anyone carrying business with the Texan Accountant of Public Accounts should be conscious of their harsh condition on tax accumulation and the ability of the Accountant to accumulate taxes.
The tax field has altered to a great extent throughout the last couple of years. We have an $18 Billion budget deficit coming into the 2011 legislative session. Accountants have been known to fudge early deficit numbers so that they appear to be heroes as they find new sources of revenue to reduce the deficit number. Taxpayers should recognize that the Accountant is using new Business sales tax Texas tools and techniques to squeeze revenue out of businesses that have never had tax issues before.
Consider – a housewife opens a home based business to sell home design fashions. She does not incorporate but does apply for and receive a sales tax permit. She changes her mind and never conducts any businesses. Being a novice, she does not respond to letters and certified mail from the Accountant. She ignores attempts by the Accountant to serve her with a lawsuit. Suddenly, from her perspective, she finds her herself on the bad side of a $10,000 default judgment for sales tax.
How did this befall? The Business sales tax Texas Accountant is permitted to reckon sales tax patterns for those businesses who do not file tax returns. When calls and letters are not returned, the collection train can’t be stopped, finally ending in a default judgment with legal fees and court costs.
This story has a good ending in that it was determined for $1,000.00. This never should have befallen, but anyone working with the Accountant has to be aware that their job is to accumulate taxes.
Another relevant case- an out of state business buys specific assets of another out of state business. During its due diligence the buying company does not come across anything that shows that the selling Business sales tax Texas company has any associations with Texas. The arrangement is ended and both sides lead off their business.
Many years go by and abruptly the Texas Accountant sends a notice of tax attributing to the purchaser. The Accountant claims that the vendor had contacts with Texas; that the vendor was unable to file returns for several years and reckoned taxes owed; and that the sale of Business sales tax Texas assets comprised of the whole business and consequently purchaser is accountable for taxes owed – over $150,000.
What? How did this fall out?
Initially, the Accountant settled that the vendor had lodged one salary sales tax report for one quarter. This permitted the Accountant to check up on the vendor to find out if any sales taxes were reported for that quarter. For sure no report was lodged so the Accountant reckons taxes due settled upon a typical company for the time period since the report was lodged through the current date. The Accountant then goes over Texas information sources to find out about the vendor. They come up with press releases, written by a press broker, proclaiming that the purchaser had bought the whole business of the vendor. Feeling suspicious, the Business sales tax Texas Accountant files suit to accumulate $150,000 in back taxes.
