Sales tax due diligence service
Don't Let Sales Tax Surprises Derail Your Deal
Hidden tax liabilities
Costly compliance gaps
Unexpected audit exposure
Transaction delays
Why Sales Tax Due Diligence is Critical
Our Comprehensive Review Process
Get startedHistorical Analysis
Current Compliance
Risk Assessment
Action Planning
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Detailed Deliverables
Comprehensive Report: Detailed analysis of findings, risks, and opportunities
Risk Quantification: Clear breakdown of potential liabilities and their financial impact
Remediation Plan: Step-by-step strategy for addressing identified issues
Executive Summary: Key findings and recommendations for stakeholders
Success Stories
Squatty Potty bailout
Manufacturing Acquisition Protected
Guidance You Can Trust.
Due diligence is not just a formality but a crucial step in safeguarding your interests and maximizing the success of your business transactions. When you choose our due diligence services, you can expect:
Our seasoned accountants and consultants bring extensive experience in due diligence across various industries and transaction types.
We review all statements, contracts, documents, and other critical information to ensure a comprehensive assessment of the business.
We work closely with you to understand your specific needs and goals, providing customized services that align with your requirements.
Our reports are clear, concise, and easy to understand. We provide you with timely and actionable insights, coupled with strategies to mitigate risk.
Simplify your sales tax compliance
Sales Tax Due Diligence for M&A Transactions
Sales tax liability doesn't disappear at close. When a business is acquired, its sales tax exposure transfers with it -- registered or unregistered, disclosed or undiscovered. A buyer who doesn't surface that liability before the deal closes inherits it afterward, typically without a clean remedy against the seller.
Sales tax due diligence exists to make sure that doesn't happen.
What the review involves
TSTP conducts a systematic review of the target company's sales tax position across every state where it has or has had a presence. That covers nexus footprint and registration history: where the business has been registered, where it should have been registered, and whether those two lists match.
It covers filing accuracy: whether returns were filed on the correct schedule, with the correct sourcing treatment, and with exemptions applied properly. Filing errors that haven't yet triggered an audit are still liability.
It covers exemption certificate compliance: whether the business has valid, current certificates on file for exempt customers, and whether those certificates hold up to scrutiny.
And it covers open audit exposure: any active audits, recent state notices, or periods that carry elevated risk based on the business's filing history.
What TSTP produces
The output of the engagement is a clear report of identified liabilities, an estimate of the exposure range by state, and a recommendation on how each item should be addressed. That recommendation typically involves one or more of four options: a purchase price adjustment to account for identified liability, an escrow arrangement to cover uncertain exposure, a voluntary disclosure agreement to resolve past liability before or after close, or representations and warranties coverage negotiated into the deal structure.
The goal is to give everyone at the table a clear, defensible picture of the sales tax risk so it can be priced and structured appropriately.
Who engages TSTP for this work
Buyers who want to know what they're acquiring. PE firms conducting diligence on a target. Sell-side advisors preparing a company for sale and wanting to surface and resolve issues before they affect valuation or deal terms. M&A attorneys coordinating diligence workstreams who need a sales tax specialist to own that piece.
The timing matters. Sales tax due diligence done before close gives all parties options. Done after close, the options narrow considerably.
Talk to us before the deal closes.
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