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For companies that have grown quickly, expanded into new markets, or simply never gotten around to a formal nexus study, sales tax registration can feel like a routine, almost clerical task. A business decides it needs to register in a new state, fills out the online registration form, checks a few boxes, and receives a sales tax permit within days. But buried in nearly every state's registration application is a question that carries far more weight than its short answer fie

Unregistered tax exposure is an accounting problem before it is a controversy problem. A company that knows it has nexus and has not filed has a liability that must be evaluated for recognition and disclosure in its financial statements, and the applicable framework differs depending on the tax. Income Tax Exposure — ASC 740 State income and franchise tax positions fall within ASC 740, including the subtopic governing uncertain tax positions. A decision not to file a return i

A VDA is a negotiated agreement between a taxpayer and a state taxing authority under which the taxpayer comes forward before being contacted about an audit, discloses the previously unreported liability, pays the tax and (usually) interest for a defined period, and receives specified relief in return. Most states operate a formal VDA or voluntary compliance program; many allow the initial approach to be made anonymously through a representative, so the company's identity is