How complex are multi-state taxes, and what is most important for business owners to understand about their liabilities?

Some states have up to 20 different types of taxes they impose on businesses, vendors and/or consumers. Add to this the additional taxes imposed by counties, cities and transit districts within each state, and you have a very large tax compliance process and resulting tax liability. The complexity of these taxes is overwhelming and they revolve around the concept of ‘doing business.

€™ What does ‘doing business’ constitute? It is precisely that: the amount of activity or business your company conducts in a given state. Federal guidelines measure how much activity is enough to be taxed.

This is why bringing in a state tax consultant can relieve headaches. Keep in mind, sales tax is among the various taxes that states impose. So whether your salespersons are employees or independent representatives, they may contribute to the company’s sales tax liability.

What’s more, if the salesperson is doing more than soliciting sales such as checking orders, approving credit or taking back bad ... more.

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