The selection criteria for audits are most often random and can be based on a number of factors. The City makes an effort to maintain a good mix of audits: old and new, large and small, retail and service businesses. Audits ensure businesses are correctly collecting and reporting sales tax and to ensure use tax is being properly reported.

· Audits generally cover a three-year period, which is the length of the City's statute of limitations. However, the statute of limitation does not apply if a business is not licensed with the City.

· A small number of proactive audits are also selected each year. These audits are designed to review business records (usually after a business has been established for around 12 months) to ensure businesses have established sufficient records and to train the businesses in their sales and use tax responsibilities.

· The audit location is usually where the records are maintained. This may be the place of business, the corporate office, or the accountant's office. The audit may also be conducted at the City's Municipal Center.

· The auditor will review the records described earlier. Most audits include a review of all purchase invoices for fixed assets and a sampling of sales activity and purchases of supplies used in the operation of the business. However, in some cases, an actual audit of all records is selected. The taxpayer has the right to select either a sample audit or actual audit.

During the course of the audit, or prior to leaving the auditor will apprise you of the findings. A tax liability may or may not result from an audit. A report summarizing the audit findings will be mailed to the business at the completion of the audit. If an assessment is made, payment is due to the City within 30 calendar days from the date the audit is mailed.

If the business disagrees with the assessment, a petition letter must be written to the Finance Director and received within 30 days from the date the audit is mailed. The petition letter must include:
· The basis for the appeal.
· The amount by which the assessment should be reduced.

A hearing will be scheduled and presented by the City and your business to a hearing officer.

Email the Finance Department

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