Our highly acquisitive client, a leading distributor of construction and industrial supplies, is steadily bringing new businesses under its umbrella. However, many of these acquired companies, while successful in their operations, have not maintained full compliance with state sales tax requirements.
Because the company’s tax leadership team is already stretched thin managing day-to-day operations, they have engaged us on multiple occasions and on a continuous basis to provide experienced tax professionals who can work independently to bring multiple entities into tax compliance and integrate them into the parent company’s tax structure.
In response to this specific client need, we provided a senior consultant to work directly with the company’s tax leadership to resolve sales tax or other regulatory obligations that acquired companies may have. The consultant conducts comprehensive reviews of sales tax obligations across multiple states to ensure that each acquired entity is properly registered and compliant.
To resolve compliance issues, the consultant took ownership of voluntary disclosure agreements (VDAs), a process that enables businesses to proactively report past sales tax liabilities while minimizing penalties. Concurrently, other consultants are executing tax-related responsibilities and playing a key role in software integrations designed to streamline the company’s sales tax reporting across its growing portfolio.
With our expert support, the company continues its aggressive growth strategy while relying on us to successfully navigate the complexities of state tax compliance for its acquired entities. Within the first five months of engagement, our consultant compiled research and sales data for 10 state VDAs and began researching several others to bring previously non-compliant subsidiaries into full compliance and ensure proactive compliance going forward. We also used this data to help the company estimate its tax exposure related to states where VDAs are pending.
As the company continues to acquire new businesses, we remain a trusted partner in helping them resolve and integrate their tax obligations and operations and reduce the risk of future penalties. Our ability to operate with minimal oversight and provide expert guidance ensures that the client can maintain compliance without adding permanent headcount and while allowing leadership to focus on long-term growth strategies. Having our support also eliminates the need for the client’s internal team to divert focus from other critical tax functions.