New State Sales Tax Laws – Is Your Accounting Firm Prepared?
Hello Passport Partner,
A good client of one of our Passport Partners, whose distribution business has been growing nicely was recently “given notice” by their accounting firm.
The client was informed that after their 2019 tax preparation services were completed, the accounting firm would no longer provide services to them.
Why would the accounting firm resign from servicing this growing, healthy company?
2018 Wayfair Decision
Their resignation was due to the complexity of new state sales tax laws that have been passed by most of the states since the Supreme Court’s Wayfair decision on June 21, 2018.
Since that decision, almost all of the states that have sales tax laws have passed their own legislation requiring businesses outside their state to collect sales tax if they exceed certain thresholds.
Many small accounting firms lack the broad sales tax expertise to deal with the new and widely varying state requirements.
In the case of this particular accounting firm, it was only at the insistence of our Passport Partner that the accounting firm investigated the extent of the new sales tax requirements and then concluded that they did not want to provide the services.
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