Workshop M CAT, Sales & Use and PTE Audits Best Practices to - - PDF document
28th Annual Tuesday & Wednesday, January 2930, 2019 Hya Regency Columbus, Columbus, Ohio Workshop M CAT, Sales & Use and PTE Audits Best Practices to Effectively Plan & Manage the Audit Process Tuesday, January 29, 2019
28th Annual
Tuesday & Wednesday, January 29‐30, 2019
Hya Regency Columbus, Columbus, Ohio
Tuesday, January 29, 2019 3:00 p.m. to 4:00 p.m.
Biographical Information
Amy Thomas Laub - Technical Director, Tax, Nationwide Insurance Company 1 W. Nationwide Blvd, Columbus, OH 43215 614-249-7070 thoma30@nationwide.com
Amy Thomas Laub works for Nationwide Insurance Company, which is headquartered in Columbus, Ohio. As Tax Director, she is primarily responsible for state income and sales & use tax areas. Prior to joining Nationwide, she worked in the Tax departments for Tempur Sealy International, Inc., located in Lexington, Kentucky, and Federal Express, located in Memphis, Tennessee. Amy has experience with multiple areas of state taxation including compliance, audits, planning, policy and incentives & credits. Amy currently serves as the Immediate Past Chair and Member of the Board of Directors for the Council on State Taxation (COST) after chairing COST until 2019 as only the third woman to chair COST over the past 49 years. She participates in numerous conferences and schools as a speaker and a facilitator. Amy is a licensed CPA and received her B.B.A. degree in accounting from the University of Cincinnati.
Chad G. Leon, Assistant Administrator, Audit Division Ohio Department of Taxation, PO Box 183014, Columbus, OH 43218 (614) 800-3967 Chad.Leon@tax.state.oh.us
Chad is an Assistant Administrator for the Audit Division of the Ohio Department of Taxation. He has over fourteen years of experience in Sales and Use tax. Chad began his career with the Ohio Department of Taxation in December, 2002 as a sales and use tax auditor in the Akron District Office. He was promoted to a Sales & Use tax audit manager in January, 2010 and held that position until he received his current position in July of 2015. Chad has audited exclusively in Sales and Use tax throughout his career and has experience in numerous industries including manufacturing, contracting, automobile dealerships, restaurants and trucking. Chad is a graduate of Malone University with a B.A. in Accounting and Business Administration.
John R. Trippier, CPA, Director (non-attorney professional), Zaino Hall & Farrin LLC 41 South High Street, Suite 3600, Columbus, OH 43215 jtrippier@zhftaxlaw.com 614-349-4815 Fax: 614-754-6368
John is Director of Multistate Tax and serves clients with more than 25 years of experience in government, public accounting/law firm and industry. He assists clients with evaluating current multistate tax positions to identify refund
defend clients throughout the audit process, which helps to ensure the client pays the minimum due. John is a certified public accountant who served as the Administrator of the Ohio Department of Taxation’s Audit Division for over eight years beginning in 2003. At the Ohio Department of Taxation, John was responsible for developing and implementing audit policy for the sales, use and commercial activity taxes. He was the architect for the commercial activity tax audit process and the audit tools that are used by auditors and managers to research taxability issues. John also spent two years as an income/franchise tax and sales/use tax auditor in the Department’s Chicago office. John has worked over 10 years in public accounting as a state and local tax consultant for Coopers & Lybrand, KPMG Peat Marwick and RSM McGladrey, Inc. As a consultant, John assisted clients with multistate sales/use, income/franchise, personal/real property, intangible and unclaimed property tax audits and appeals. John also assisted clients with multistate refund reviews, corporate restructuring, compliance studies, nexus studies, voluntary disclosures and sales tax software implementations. John also worked 9 months for the law firm of McDonald Hopkins where he was director of Multistate Tax Services. John worked in industry as a state and local tax manager of a telecommunications company responsible for audits, appeals and state and local sales/use, personal/real property and income/franchise tax compliance. John is a frequent presenter on Ohio sales, use and commercial activity taxes for the Ohio Society of CPAs, Ohio Tax Conference and various other associations throughout Ohio.
January 29, 2019
This document and information is provided by Zaino Hall & Farrin LLC for general guidance only, and does not constitute the provision of legal advice, accounting services, investment advice, written tax advice under Circular 230, or professional advice of any kind. The information provided herein should not be used as a substitute for consultation with professional tax, accounting, legal, or other competent advisers. Before making any decision
been provided with all pertinent facts relevant to your particular situation. The information is provided “as is” with no assurance or guarantee of completeness, accuracy, or timeliness of the information, and without warranty of any kind, express or implied, including but not limited to warranties of performance, merchantability, and fitness for a particular purpose.
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concepts apply to all tax types
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equitable
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audits
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liability
reduction on all requests prior to assessment
during the audit and other items to make fair and consistent decisions
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method
authority
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manage the program and ensure that changes in procedures, accounting systems, business model, etc. are being communicated with ODT
agreement 30 days prior to making them
granted to businesses to promote the efficient administration of Ohio’s sales and use tax law pursuant to ORC 5739.031
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customer
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positions taken/reserve, if any
implementation of audit results
consultants, etc.)
voluntary disclosure/amnesty
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dates
next steps
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replacement
left behind with auditor)
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Typically easier (and less costly) to remove issues at audit level
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accurate audit
documents/information
team/involve tax advisor
assessment
time/costs expended
maintained
company
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BRUTUS reports are different)
participatory/managed audit
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already under audit
refunds
incorporated as part of an audit (statistical sample, bulk credit)
audit if you feel you are in a refund position
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compliance software
managed/participatory audits for gap periods
Representative Sample Analysis
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John R. Trippier, CPA
Zaino Hall & Farrin LLC 614-349-4815 jtrippier@zhftaxlaw.com
Amy Thomas Laub
Nationwide Insurance Company 614-249-7070 thoma30@nationwide.com
Chad Leon
Ohio Department of Taxation 614-800-3967 chad.leon@tax.state.oh.us
{CASEST~1-1 }
SCENARIO You have just been hired by Simpson Audio Management, LLC (SAM). You are responsible for sales and use tax and commercial activity tax (CAT) for the company and its affiliates. The corporate structure is as follows:
SAM Retail, LLC (Retail) and third-party authorized retailers. Retail also sells installation and repair services and maintenance contracts (which Retail employees perform the maintenance service). SAM has the headquarters functions and provides management services and licenses intangibles to Mfg., Retail and the third-party authorized retailers. SAM also leases real property and certain items of tangible personal property (TTP) to both
timely filed
Audit Division P.O. Box 183014 Columbus, OH 43229 http://tax.ohio.gov/ Letter - Audit Commencement Rev - 3/18 1
December 7, 2018 SAM Manufacturing, LLC 123 Sam Lane Columbus, Ohio 43218 Re: Sales and Use Tax Audit 01/01/15 through 1/31/2017 Dear Taxpayer: Pursuant to Chapter 5703 of the Ohio Revised Code, the Department is commencing a sales and use tax audit on your company for the periods referenced above. As we discussed in our telephone conversation
We will need to examine all pertinent records for the purpose of determining sales and use tax liability. To ensure an orderly audit, please send me the information listed below for the entire audit period on or before December 12, 2018.
period listed above for the taxpayer to whom this letter is addressed. Please identify the accounting software(s) used during the audit period.
date, amount, and tax amount.
As the audit progresses, additional information will be requested such as purchase invoices, sales invoices, exemption certificates, or other documentation necessary for the completion of the audit. This letter does not preclude the Department from requesting information for any other Ohio taxes. We are requesting that the information referenced above, be provided in electronic format via one of the Department's secure channels, a flash drive, or compact disk. While we have the capability to translate most software language, Excel is the most universal application software utilized and is our preferred
process time is greatly reduced, the time required to re-enter those transactions found to be in error during
download, please contact me prior to generating any reports for use in the audit.
Letter - Audit Commencement Rev - 3/18 2
The Department recognizes the need for the secure transmission of data. There are several options utilized by the Department to securely transfer data and information back and forth, including FTP GoAnywhere server, SecureZip for attachments, and ZixCorp secure email server. The enclosed Data Transfer Method document details each of these and other options, I can provide you with additional information on these secure data transfer methods, should you have any questions. Your participation and cooperation with this audit process is essential to the efficient completion of the
statute of limitations, or compelling us to complete the audit using the best information available.
an audit plan showing various estimated milestone dates in the audit process and share it with you upon your request.
given task or tasks within the audit process. All audit results will include statutory penalty for failure to comply at the time the tax was due. Consideration may be given for penalty reduction prior to assessment. Enclosed is the Ohio Taxpayer's Bill of Rights pamphlet providing a written description of your and the Department's role in the audit and your rights, including the right to a refund in the case of overpayment. As an Ohio taxpayer, you may be represented by an attorney, accountant or other tax advisor during the
correspond with your representative. You will be notified in writing of all adjustments made (if any), at the conclusion of this examination. Your appeal rights and procedures will be provided to you at time of assessment. Please contact me if you have any questions or need further information. Sincerely, Johnny Auditor 614-800-8000 Ohio Relay Service for the Hearing Impaired (800) 750-0750 Johnny.auditor@tax.state.oh.us Security Notice: Please do not provide confidential information through unsecured channels Enclosures: Declaration of Tax Representative (TBOR-1) Taxpayer Bill of Rights Data Transfer Method Document