With the passage of the Marketplace Fairness Act, fears about compliance are running rampant through businesses subject to the new internet sales tax regulations. While this fear is understandable, it can be mitigated by the simple use of modern technology.
Internet sales tax computation should be relatively easy for any business willing to use technology to its advantage. We get overwhelmed looking at the requirements: for example, if you ship to North Carolina, you need to cover North Carolina state taxes, including the various county and local sales taxes. Some states require you to collect and file sales taxes and others only require you to notify your customers that they will owe it to their state department of revenue. Multiply these considerations by the 46 states that currently have a sales tax, and no wonder internet business owners are confused!
Using an internet software system can make the conversion much less painful and a lot less overwhelming. Software that updates automatically keeps you abreast of the newest tax laws and makes sure that the computations you use for each address are appropriate. It can even print out your tax forms for you. Without a software system, you would have to maintain all your records manually, and if your business is large enough to fall under the requirements of the Marketplace Fairness Act, this would not be a small undertaking. In addition, every time any particular jurisdiction changes its regulations, you would need to change all your transactions – again, manually.
Of course, using internet sales tax computation software comes with a set-up cost. But when compared to the cost of maintaining a manual system (or worse, dealing with a compliance failure and the penalties and legal fees associated with such), the cost is justified.
When you are ready to look into a technological solution to the new tax codes, contact us for an in-depth discussion of your situation. We were founded by former accountants and technology specialists. We understand the issues and can apply the right technology in the right measure for your business.
