How Is This For Fiscal Responsibility?
I received a sales tax audit notice for Alabama today. I found this odd, as it is a three year audit and we have only operated in the state for 6 months. In fact, all four of the audit sample months they chose had zero sales. I have never even heard of anyone being audited with this little history.
So, I call the auditor, and explain all of the above, expecting an answer like "oops, no point in proceeding." How naive I am. He says we have to proceed with this, and listed a pile of documents he has to see which will take me about 6 hours of my time to track down and Xerox. Included in this, in addition to all the revenue records, he wants to see every single invoice we paid in Alabama to make sure we didn't secreatly buy stuff out of state and avoid their use tax (the tax you are supposed to pay, ha ha, if you buy items out of state with no sales tax. You guys all file your use tax reports on Amazon purchases, right?)
But here is the part that really pissed me off. When I asked him why I was being audited after just 6 months, he said he knew the audit was senseless but his office is desperately trying to keep everyone employed during recent budget cuts so that no one would lose their job. Also he said is was good training for him. Great. I have to do 6 hours of extra work so that later I can pay higher state taxes to support more government workers. What a deal.
Bill Beeman:
Obviously this 'full-employment program' is similar to one I hit some years ago in Santa Clara County, California.
We had a sales tax auditor spend almost two months occupying a desk in our accounting office, demanding the production of all kinds of printouts, and at the end of the day finding no liability. Bad enough, but the episode was repeated the following year.
She had a great deal of difficulty communicating with our staff, as her English was very limited, and her understanding of California sales tax regulations was very lacking.
All in all a huge waste of time and tax dollars, to say nothing of our accounting staff time. So while I surely sympathize with you, it's an old game.
January 12, 2010, 3:38 pmsteep:
Of course I pay my state use tax on business purchases. Especially since the audit I got 3 years ago. They were auditing by profession and engineers came up that year. I'm just glad I don't spend enough to require the monthly filing and extra paperwork.
January 12, 2010, 3:50 pmDrTorch:
B. Beeman describes the Wet Nurse from Atlas Shrugged. This is all kind of creepy.
January 12, 2010, 4:01 pmDrTorch:
B. Beeman describes the Wet Nurse from Atlas Shrugged. This is all kind of creepy.
Of course Coyote, you know the correct response is to send your Alabama acquaintance way too MUCH documentation. Send him reams and reams of factual, but pointless, information. Included in which are the relevant documents.
Then let him sort it out as part of his "training."
January 12, 2010, 4:03 pmAllen:
The scariest thing to me is that he'd actually tell you this. To me, it means he likely doesn't understand what he's really admitting to.
January 12, 2010, 4:18 pmNormD:
A few years ago California moved Use Tax line to the main 540 tax form. Before that, you had to file an additional form. When its on the 540 you must enter something. Most people enter $0. During an audit, the auditor simply asks "Ever buy anything at Amazon.Com"? Of course you say, thus admitting tax fraud and giving the auditor a powerful lever.
January 12, 2010, 4:36 pmO Bloody Hell:
> The scariest thing to me is that he’d actually tell you this. To me, it means he likely doesn’t understand what he’s really admitting to.
If it ain't legally actionable, and I doubt very much if it is, then WTF does he care?
That's the problem. It's no skin off his nose.
We need to perform an inverse decimation of the government's ranks on all levels. That is, we leave one in 10 alive.
January 12, 2010, 8:52 pmJames R Ament:
It's also called "the tyranny of the clerks."
January 13, 2010, 7:28 amGregg:
At least he is honest. No one would make up something like that. A good indicator of what really motivates government bureaucracies.
January 13, 2010, 10:04 amDan:
This sounds Kafka-esque. Except that if it were really a Kafka novel, you would have been arrested and never told what the evidence was against you before finally being executed.
January 13, 2010, 10:45 amaeronathan:
Its about par for the course. The state of AL feels the need to hassle me about every 6 months to determine if I do in fact have liablity insurance on my vehicle. This is despite the fact they hold my title, know there's a lein holder and my truck would be reposessed should I know have full coverage insurance on it....
January 13, 2010, 2:36 pmGreg:
Strangely enough, I do pay my state use tax, as an individual.
January 13, 2010, 9:52 pm