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New York Sales Tax Defense Lawyers

Sales and use tax laws are very confusing in New York.

Failure to comply with sales and tax use rules can lead to tax assessments, interest, and even penalties. Corporate officers and owners can be held liable for the amount due.

Raiser & Kenniff Law Group can help with a wide array of sales and tax law issues, hire our New York Sales Tax Defense Lawyers.

Our goal is to help business owners, accountants, attorneys, etc, understand the sales and use tax laws.

NY Sales Tax Audits are the last thing you need

Certain businesses that have lots of cash transactions have a higher chance of sales tax audits and problems. As such, delis, restaurants, bars, autobody shops, have a higher incidence of sales tax audits and sales tax collection problems.

All NY businesses that collect, and remit, NY sales tax are at risk. If your business was notified of a NY Sales Tax Audit, or if you’re being pursued for past due sales tax, there are a number of things you MUST be aware of in order to limit the exposure of your business and personal finances.

Why you could be audited for sales tax – you want a New York Sales Tax Defense Lawyer

Christine Twomey
Christine Twomey
Just had my Divorce case settled 2 months ago after having a horrible experience with another firm. I couldn’t be happier with Claire Banks and Elizabeth Garvey with their outstanding professionalism in doing so with Spodek Law Group. Any time I needed questions answered they were always prompt in doing so with all my uncertainties after 30 yrs of marriage.I feel from the bottom of my heart you will NOT be disappointed with either one. Thanks a million.
Brendan huisman
Brendan huisman
Alex Zhik contacted me almost immediately when I reached out to Spodek for a consultation and was able to effectively communicate the path forward/consequences of my legal issue. I immediately agreed to hire Alex for his services and did not regret my choice. He was able to cover my case in court (with 1 day notice) and not only was he able to push my case down, he carefully negotiated a dismissal of the charge altogether. I highly recommend Spodek, and more specifically, Alex Zhik for all of your legal issues. Thanks guys!
Guerline Menard
Guerline Menard
Thanks again Spodek law firm, particularly Esq Claire Banks who stood right there with us up to the finish line. Attached photos taken right outside of the court building and the smile on our faces represented victory, a breath of fresh air and satisfaction. We are very happy that this is over and we can move on with our lives. Thanks Spodek law 🙏🏼🙏🏼🙏🏼🙏🏼🙌🏼❤️
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Keisha Parris
Believe every single review here about Alex Z!! From our initial consultation, it was evident that Alex possessed a profound understanding of criminal law and a fierce dedication to his clients rights. Throughout the entirety of my case, Alex exhibited unparalleled professionalism and unwavering commitment. What sets Alex apart is not only his legal expertise but also his genuine compassion for his clients. He took the time to thoroughly explain my case, alleviating any concerns I had along the way. His exact words were “I’m not worried about it”. His unwavering support and guidance were invaluable throughout the entire process. I am immensely grateful for Alex's exceptional legal representation and wholeheartedly recommend his services to anyone in need of a skilled criminal defense attorney. Alex Z is not just a lawyer; he is a beacon of hope for those navigating the complexities of the legal system. If you find yourself in need of a dedicated and competent legal advocate, look no further than Alex Z.
Taïko Beauty
Taïko Beauty
I don’t know where to start, I can write a novel about this firm, but one thing I will say is that having my best interest was their main priority since the beginning of my case which was back in Winter 2019. Miss Claire Banks, one of the best Attorneys in the firm represented me very well and was very professional, respectful, and truthful. Not once did she leave me in the dark, in fact she presented all options and routes that could possibly be considered for my case and she reinsured me that no matter what I decided to do, her and the team will have my back and that’s exactly what happened. Not only will I be liberated from this case, also, I will enjoy my freedom and continue to be a mother to my first born son and will have no restrictions with accomplishing my goals in life. Now that’s what I call victory!! I thank the Lord, My mother, Claire, and the Spodek team for standing by me and fighting with me. Words can’t describe how grateful I am to have the opportunity to work with this team. I’m very satisfied, very pleased with their performance, their hard work, and their diligence. Thank you team!
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Hey, how you guys doing? Good afternoon my name is Anthony Williams I just want to give a great shout out to the team of. Spodek law group. It is such a honor to use them and to use their assistance through this whole case from start to finish. They did everything that they said they was gonna do and if it ever comes down to it, if I ever have to use them again, hands-down they will be the first law office at the top of my list, thank you guys so much. It was a pleasure having you guys by my side so if you guys ever need them, do not hesitate to pick up the phone and give them a call.
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Loveth Okpedo
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Bee L
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Amazing experience with Spodek! Very professional lawyers who take your case seriously. They treated me with respect, were always available, and answered any and all questions. They were able to help me very successfully and removed a huge stress. Highly recommend.
divesh patel
divesh patel
I can't recommend Alex Zhik and Spodek Law Firm highly enough for their exceptional legal representation and personal mentorship. From the moment I engaged their services in October 2022, Alex took the time to understand my case thoroughly and provided guidance every step of the way. Alex's dedication to my case went above and beyond my expectations. His expertise, attention to detail, and commitment to achieving the best possible outcome were evident throughout the entire process. He took the time to mentor me, ensuring I understood the legal complexities involved to make informed decisions. Alex is the kind of guy you would want to have a beer with and has made a meaningful impact on me. I also want to acknowledge Todd Spodek, the leader of the firm, who played a crucial role in my case. His leadership and support bolstered the efforts of Alex, and his involvement highlighted the firm's commitment to excellence. Thanks to Alex Zhik and Todd Spodek, I achieved the outcome I desired, and I am incredibly grateful for their professionalism, expertise, and genuine care. If you're in need of legal representation, look no further than this outstanding team.

There’s four common reasons for a business to be the target of a NY sales tax audit

Failure to report sales tax

If you’re making sales which are subject to sales tax, you have to be registered with the Department of Tax to find a certificate of authority. This gives you the right to collect tax on sales. If you have a Certificate of Authority, NYS may review your filings to determine whether sales tax returns are being filed timely. If NYS determines you are failing to report sales tax, and audit can be triggered.

Constantly filing late

Two of the most common reasons for a sales tax audit is either because you failed to file sales tax, or constantly file sales tax returns late. If you’re registered for sales tax in NY, then the state requires you file sales and use tax returns quarterly, monthly, or annually, by a required due date. This applies even if your business didn’t make any sales during the period.

If you have a history if failing to file timely sales tax returns, or pay them on schedule, then NYS will audit you to vet the accuracy of your accounting.

History of past NYS sales tax audits

It’s very common for NY to audit businesses against and against, if the current audit showed your bookkeeping isn’t done properly. Failure to have a point of sale system, or proper bookkeeping shows the auditor there’s a high likelihood of a recurring issue. The chances of another audit increases if the existing audit resulted in your business owing a large assessment.

What industry are you in?

Your business can be guilty by association. Certain industries have a higher incidence of noncompliance. Typical targets of NY sales tax audits are restaurants, delis, contractors, and other businesses that have a lot of cash sales.

The NYS Department of Tax and Finance is responsible for collecting and enforcing sales tax. It’s the job of the auditor to decide whether your business has paid the correct amount or not. NYS takes sales tax very seriously, because sales tax is considered trust fund taxes. Your business is collecting this money on behalf of New York State. It’s NYS property, not yours. By routinely auditing small businesses, NYS is ensuring that businesses are complying with sales tax laws. Larger sales tax audits increase NYS revenue due to the large penalties that businesses have to pay if they commit fraud or incorrectly report sales tax.

How long do NY Sales Tax Audits take? They Go Faster with a New York Sales Tax Defense Lawyer

The length of time of an audit depends on the complexity of the sales tax, as well as the scope. For example, what period of time of the business is covered, what records are requested, etc. They can take anywhere from 3 months to 12 months.

It’s likely you’ll continue to get audited again and again.

Sales Tax Audit Defense Tips

These can be confusing and complexing events. If you get a notice of a New York sales tax audit, you are probably scared. It’s important you reach out to a NY sales tax lawyer to create a strategy to protect your business.

  • The auditor isn’t your friend. Be professional, but don’t forget this
  • Hire a tax lawyer to help you create a strategy
  • Prepare your books and records for review, so there are no questions.
  • Only provide what’s requested
  • Do not volunteer extra information
  • Be calm, but don’t act with anger towards the auditor
  • Do not sign any documents

Negligence and Tax Evasion

If NY determines you attempted to evade payment, reporting, or assessing NY sales tax, you could be investigated for NY Sales Tax fraud. NY has a criminal investigation department, which conducts an investigation to determine if you engaged in a deliberate scheme to avoid payment of sales tax. If they discover this, then it could be referred to a local district attorney in the county in which you conduct business for further prosecution.  Any communication between you and your accountant are not attorney-client privilege. As a result, you should speak to your sales tax attorney, so that attorney-client privilege is maintained.

Because sales tax is a trust fund tax, you could be held personally responsible for the sales tax liability of the business. You are deemed a responsible person if you were an owner, or were someone responsible for collecting and paying the sales tax.

How to avoid, and survive, a NY sales tax audit? Hire a New York Sales Tax Defense Lawyer

Cross Check Tax Returns: One of the ways businesses are selected for an audit is based on cross-checking between sales tax reporting and your 1099-K’s from the IRS. If your deli/bar/etc takes debit or credit cards, then you have a merchant account. This processing is reported to the IRS on Form 1099-K. You should compare sales reported on federal returns with the state returns to make sure they are aligned.

Keeping good records and keeping happy employees are also important in avoiding a sales tax audit.

Statute of Limitations

The statute for a NY sales tax audit is 3 years, unless the Tax Department gets your consent to the contract. This doesn’t apply if you have removed sales tax returns, or filed a false/fraud return.

How long are NY sales tax audits? Hire a New York Sales Tax Defense Lawyer

The length of time will depend on the complexity of the sale tax of the business, as well as how long of a period is requested. They can take 3-12 months to conduct. If your business is audited for sales, it’s likely you’ll be audited over and over again.

Failing to file sales tax on a timely basis is a serious offense, since sales tax are considered a trust fund tax. Failure to file, is considered a crime.

Penalties and interest can be up to 14.5% of the liability.

What are NYS sales tax enforcement stages

  • You get a collection notice with penalties and interest
  • It’s assigned to an agent for enforcement
  • Tax warrant is issued
  • Levy of receivables of the business
  • Revoking certificate of authority
  • Your business is shut down
  • Business assets are seized and sold
  • You are held personally for liability
  • Your driver’s license could be suspended
  • Your personal assets could be seized

Once your business is issued a tax warrant, it could result in your business receivables and assets being seized. In addition, a tax warrant becomes a matter of public record and can be enforced for 20 years.

How a NYS Sales Tax Attorney Can Help

We defend your rights at a sales tax audit. Business owners often talk too much, and provide information they shouldn’t. Our goal as your NY sales tax attorney is to defend against possible overpayments of sales tax.

We work to negotiate a payment plan with the NYS agent. If you truly owe back sales tax, we’ll work with you and the department. We’ll determine what is an acceptable down payment plan, and make a payment arrangement. Depending on the installment agreement, NYS may require disclosure of the asset, incomes, and expenses, of the business. Before beginning the negotiation process, it’s important that a sales tax attorney review your business and help you understand the terms of the payment plan. One of the mistakes we see business owners make is they negotiate terms that aren’t favorable to the business. You should also be aware that the NYS agent will note your conversations.

Another thing we do is reduce your potential criminal exposure. One of our primary goals is to reduce criminal exposure. Most sales tax matters involve the payment of back taxes and penalties. It’s important that you are represented by a NYC sales tax lawyer.

Another thing our NY sales tax lawyer can do is offer in compromise. If your business is assessed a large sales tax liability you cannot afford – then rather than close the business there might be a solution. The solution is the offer in compromise program. If it’s accepted by the department of taxation and finance, your liabilities could be lowered. The criteria for evaluation involves a review and analysis of your assets, income, and expenses of the business.

One of the reasons an offer will fail is that the offer was not based in NYS tax law. One of the biggest mistakes we see business owners make is simply throwing out a number they think the department will accept.

This is a very complicated calculation, and you want an experienced sales tax attorney so your offer is accepted.

Another thing we can do is help with NYS sales tax penalty abatement. Penalties can be abated if our attorneys can help prove you had reasonable cause under NYS tax law. Our tax attorneys can help you understand whether you have reasonable cause, and create a possible penalty abatement.

Another thing we can do is remove penalties by proper disclosure. There could be instances where a business owner understated the sales tax of the business. Failing to file, or intentionally understating sales tax return, can be considered a crime in NYS. Filing a past due sales tax or amended return doesn’t eliminate criminal exposure. NY has a voluntary disclosure program which can eliminate exposure and penalties.

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