What Does Your Ohio Department of Taxation Final Determination Letter Mean Regarding Your Sales Tax Liability?
This article will dissect the typical Ohio Department of Taxation Final Determination Letter regarding your sales tax liability. For more information about the process in sales tax cases, call us for a free consultation at 937-985-1843, email us at email@example.com, or Contact Us HERE.
"This is the final determination of the Tax Commissioner under Ohio Revised Code ("R.C.") section 5739.30 concerning the suspension of Vendor's License No. [Your Vendor's License Number]."
Comment: R.C. Section 5739.30 includes a prohibition on failing to file a sales tax return and the penalties that can result from such a failure. One of the penalties that the Department of Taxation can utilize against a taxpayer is suspension of their vendor's license. If your license is suspended, you'll receive notice from the Department and then about 10 days later, investigators will show up at your business location and post a large, brightly-colored sign at all public entrances stating that you are NOT permitted to make retail sales at the location. You are also specifically prohibited from removing the signs.
"[Your Vendor Name] (hereinafter Vendor) is required to timely and properly file monthly sales tax returns and has failed to file returns and/or pay the tax due in accordance with R.C. section 5739.12 for the months of: [Months you are alleged not to have filed sales tax returns]."
Comment: This section lays out the months that you've either failed to file required sales tax returns or failed to pay the amounts due. You should check your records and confirm that the Department of Taxation has correctly identified returns that are missing or payments that have not been made. If you find a mistake, you should bring it to the Department's attention immediately. But don't be surprised if you don't get anywhere with your inquiries.
"This failure to timely and properly file sales tax returns and/or pay the tax due is a violation of R.C. 5739.30(A)."
Comment: As mentioned above, Section 5739.30 of the R.C. provides penalties for failing to file sales tax returns. Sub-section "A" of that section is the part that prohibits a business from failing to file required returns.
"Pursuant to R.C. 5739.30(8)(2), an authorized agent of vendor was given notice of the Tax Commissioner's intention to suspend Ohio Tax Account#: [Your Vendor's License Number] on or after ten (10) days of service of that notice. Vendor in that notice was told that it could schedule an administrative hearing to allow a vendor to present evidence and testimony to show why the license should not be
Comment: If you've gotten to the point of receiving this notice, you should have received the notice referred to above. If you believe that you did not receive that notice, you may have a legal right to challenge the Department's Final Determination. But be forewarned, that kind of challenge is going to be a long uphill battle.
"Vendor did not request such a hearing. Therefore, it is ordered that upon delivery of this final determination. Vendor's license No. [Your Vendor's License Number] should be, and hereby is, suspended until Vendor, as required by R.C. 5739.30(8)(2), has filed returns and paid the full amount of the tax, penalties, and other charges due through the current reporting period. Further, no vendor's license will be reinstated until Vendor is current with any and all payment plans entered into through a Memorandum of Understanding."
Comment: When we deal with the State regarding taxes other than Sales and Use taxes and employee withholding taxes, they are often able to give my clients options for repayment and mitigation of consequences of failing to file returns or pay taxes due. When it comes to Sales and Use taxes, the State of Ohio Department of Taxation means what it says here. They will not under any circumstances reinstate your vendor's license UNLESS you file the required returns and pay all amounts due. They will not make an exception for you regardless of your particular set of circumstances.
"Sales tax returns are required to be filed electronically. Information regarding electronic filing options can be obtained from our Web site attax.ohio.gov. Only guaranteed funds (cash, certified check, money order or credit card} will be accepted. ACH payments will not be accepted."
We can advise our clients regarding signing up for an Ohio Business Gateway account and filing their returns or paying sales and use tax, but our first recommendation would be to hire a good CPA to handle those filings. Your job is to run your business, not become an expert in tax matters. If you need a CPA referral, feel free to call our office for our recommendations.
"It is further ordered that notice of this suspension be posted at every public entrance of the business premises."
Comment: As mentioned above, a notice will be posted at your business and you will be prohibited from making retail sales until you come back into compliance. If you make retail sales while your license is suspended, you could face FELONY charges. Don't do it!
We help clients who have been charged with a misdemeanor for failing to file a tax return, so call us at 937-985-1843, email us at firstname.lastname@example.org, or contact us HERE to schedule a free consultation. Time limits may apply in your case, so don't wait to call.