CDTFA Audit Clarification

As we discussed in the last newsletter, many dentists are being audited by the California Department of Tax and Fee Administration (CDTFA.)  As a reminder, this initiative for collecting taxes came about by California Assembly Bill (AB) 147 requiring retailers located outside of California to register with the CDTFA and collect California use tax.  If you are selected, your audit will be for a three-year period in which they look for purchases you made that did not have sales tax paid at the time of purchase.

PracticeCFO is very experienced in helping you navigate through this endeavor and work to make it easier for you.

Until this time, PracticeCFO was able to simply acknowledge on your California personal return whether you had any unpaid sales tax.  No CDTFA number would necessarily have been required.

However, once you are selected for an audit, and a sales tax liability is found to be due, the CDTFA will require you to register and will assign a CDTFA number for you.  You will then be required to file an annual CDTFA return going forward and they will send the annual filing form or email notice to you which will be for reporting period January – December, and the filing will be due by April 15.  The account number and access code are needed so we will be able to file it for you online and get instant confirmation for your records.

You may forward that filing notice to us as you would do, for example, with your TDIC workers comp audit form, or your annual business property tax form,  and we will be glad to file it for you.

For further reading, you may visit their website:

https://www.cdtfa.ca.gov/industry/wayfair.htm#GettingStarted

 

Greg Blake CPA, ABV

Director of Transitions

 

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