The state of Ohio routinely conducts sales and use tax audits on selected taxpayers to assure they are complying with the tax laws. Historically, the audit process has involved a detailed review of certain records by tax agents to confirm that tax was paid correctly. The Ohio Department of Taxation constantly strives to reduce the time and resources needed for itself and taxpayers to conduct audits without sacrificing accuracy. Recognizing that the traditional audit might not always be the most efficient approach, Ohio pioneered the managed audit, a process of limited agent intervention in order to identify problem areas. The audit candidate performs much of the actual work and in return, is allowed to make a voluntary payment of any tax plus interest.
Any business has the potential for becoming a managed audit candidate.
Smaller and medium sized operations make the ideal cases. It is a process that does not apply to every audit scenario but taxpayers and practitioners should keep an open mind to its application, resulting benefits and efficiencies. The more complex the issues, the less likely the managed audit will become the appropriate approach. Proposals can apply to tax due on purchases, tax collected and not remitted by retailers or situations where tax should have been collected but was not. The request must disclose the identity of the taxpayer.