Sales tax is hard to master, and a topic that commonly elicits groans among small business owners. And while the topic is often scorned, it’s essential for small business owners to understand sales and use tax compliance to avoid scrutiny from auditors. Learn the big difference between sales tax and use tax, and the critical questions to ask to determine if you have nexus. You’ll also gain a greater understanding about how technology is impacting the sales tax landscape and tips on how to avoid a sales tax audit. Guest expert Mark Giddens, one of Avalara’s founding employees with 16 years of sales and use tax management experience, teaches the basics of sales and use tax in an easy-to-understand way. Visit www.manta.com/resources/events/ to attend the webinar.

1. Crowds with Cash
Alternative Financing is a Mixed Moneybag
of Opportunity for Small Business
Hello!
Welcome to Manta’s Small Business Expert
Series
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2. Sales Tax Basics for Small Business Owners
Everything you need to know
to make sales & use tax compliance easy
#mantaexperts Today’s webcast is sponsored by

3. CEO
Welcome
John Swanciger

4. @carie_ferg
Help Q&A
Resource List
How It
Works
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5. The Story
• Sales tax helps state
deficits
• Sales tax compliance
challenges
• Cost of BUA (business as usual)

6. • Meet the expert: Mark Giddens
• Sales vs. use tax
• Determine nexus
• Technology’s impact on sales tax
• Avoid sales tax audits
• What you want to talk about: Q&A with Mark
Let’s Talk About

7. Meet Mark Giddens
Click on the speaker widget to learn
more about Mark.

8. Sales tax—Intrastate transaction, collected by the seller on
the gross receipts from a retail sale
Seller’s use tax—Interstate transaction, where the seller is
compelled to collect tax because of Nexus
CONSUMER use tax
Purchases of equipment and supplies from out-of-state for
use in business
• Withdrawals of inventory for taxable use such as R&D,
promotional materials, warranty repairs, etc.
Sales vs. Use Tax

9. • Auditor red flags
• What is and
isn’t exempt?
• Burden of proof:
consumer or seller?
Sales & Use Tax: Exemption Certificates

10. Nexus: What is it?
• The right
questions to ask
• Nexus rules and
Amazon laws apply
to everyone

11. • Quill vs. North
Dakota
• Nexus-creating
activities
• “Amazon Laws”
The Broadening of Nexus
Photo courtesy of istockphoto.com.

12. Nexus-Creating Activities (Examples)
Multi-state locations
Maintenance/service/repairs
Own/lease real property
Hosted Data Centers
Field sales/service staff
Charge Licenses/royalty/fees
Direct and/or online sales
Maintains inventory
Affiliates
Tradeshows
Commissions to resellers (1099s)
Investors/board members
Marketing/Web advertising
Drop shipments

13. • Close isn’t close enough
• The problem with ZIP codes
Jurisdiction Assignment
Greenwood Village, Colo., has one ZIP code,
but four different sales tax rates!

14. Technology’s Impact: Before You Automate
• Estimate tax
“leakage”
• Determine tax
process costs
• Cash flow considerations

15. • Saves time
• Increases accuracy
• Mitigates risk
• Improves efficiency
• Increases
profitability
Technology’s Impact: Automate

16. Technology’s Impact: What to Automate
• Calculate, report, return, remit
• Taxing jurisdictions ≠ zip code
boundaries
On average, accounting professionals
spend *11 hours a week filing sales tax
returns and remitting payments. This is
time that can be reclaimed and used
elsewhere if your company automates
the sales and use tax process. *Wakefield Research 2014

17. Avoid Sales Tax Audits
 Return information that doesn’t
match other records
 Mistakes found in previous audit
 Previous finding of exemption
certificate misuse
 Not reporting use tax
 Failing to file a return
 Failing to report sales
 Taking excessive credits or
exclusions on a return
 Filing returns with errors

18. • Do a nexus study
• Stay up-to-date with
rate, rule, and boundary
changes
• Report consumers’ use
tax
• Be compliant from day
one, especially new
businesses
• Automate with
technology
• An understanding of
your filing
requirements
• Calculations that are
rooftop accurate
• Product taxability
coverage
• Detailed sales records
• A process for
managing exemption
certificates
You should: Make sure you have:
Avoid Sales Tax Audits

19. Know the difference:
• Services on tangible
personal property
• Real property services
• Professional services
19
Avoid Sales Tax Audits: Services
States that do tax
(many) services
*Connecticut
*Hawaii
*New Mexico
*South Dakota
*West Virginia
States that do
not tax (many)
services
*Alabama
*Florida
*North
*Carolina
*Oklahoma
*Utah
Hint! States often define taxable services differently.

20. Open the resource list to get more
information about our upcoming and
on-demand webinars. Don’t miss our
upcoming webcast series, each 10
minutes long, on the following:
Oct. 6 - 10 Sales Tax Rules
Oct. 13 - Tax Tips for Online Sellers
Oct. 20 - Avoid Sales Tax Audits
Ask the Expert: Mark Giddens
Today’s webcast is sponsored by
Visit community.manta.com/ to Ask the Expert

21. Manta believes in empowering small businesses to achieve
success. We’re inspired by your determination and energy. And
we understand that every company is unique.
We strive to provide the marketing tools and educational
resources you need to stand out, connect with your customers
and your peers, and grow your business.
Send us a note and let us know what you’d like to learn from
upcoming webinars like this one.
events@manta.com