Use Tax: The Hidden Danger in Invoices

Webinar: ID# 1018022
Recorded CD
About This Course:
Effective control of use tax exposure requires an understanding of sales and use tax laws and critical evaluation of invoices for hidden dangers. Sales and use tax compliance is predominantly form over substance discipline where the documentary evidence of a transaction guides the proper application of tax.

Evaluation and retention of invoices and contracts is essential for ongoing, accurate compliance. The hidden dangers lurking in even the most seemingly innocuous of invoices can cost companies thousands of dollars under audit. Examination of features such as shipping terms, defined shipping points, the nature and description of services performed, bundled pricing, nexus implications for proper tax application, statements of tax and the rates of tax charged is essential. Of equal importance is ensuring that the form of the transaction (i.e. the invoice) accurately reflects the substance of the transaction, because it is that form which governs the application of sales and use tax.

Gain a greater understanding of the pitfalls in sales and use tax compliance, and obtain the tools to put this knowledge to work in minimizing your company's sales and use tax exposure.


Sales and Use Tax Compliance Overview
Concepts in Sales and Use Tax
  • General Rules
  • Taxability of Property vs. Services
  • LumpSum vs. Bundled Invoicing
  • Nexus Implications and Their Effect on Invoicing
  • Physical Nexus; Economic Nexus
  • Marketplace Fairness Act
  • Form Over Substance – Documentary Evidence
  • Purchase Orders; Invoices; Contracts
  • Situs/Sourcing Issues
  • Streamlined Sales Tax Rules
  • Shipping Terms Transfer of Title/Possession
  • Services
Invoicing Pitfalls
  • Shipping Address vs. Billing Address
  • Shipping and Handling Charges
  • Separate Statement of Tax
  • Tax Charged for the Correct Jurisdiction?
  • Labor Charges
Types of Transactions
  • Real Property vs. Tangible Personal Property
  • Services
  • Software
  • Canned vs. Custom
  • Maintenance
  • Method of Delivery
  • Software as a Service
  • Leases
  • Employee Purchase Cards
  • Recordkeeping
  • Electronic Receipt Settlement
State, County and Local Taxes
    A Look Into the Future
    About The Presenter

    John R. Morrow
    • Accountant with JR Morrow Consulting, LLC
    • Focuses on payroll taxes, sales and use taxes, and financial statement analysis
    • 22 years of experience in taxation
    • Previously with the Internal Revenue Service, and as manager of taxation in the private sector responsible for corporate income, payroll, and sales and use taxes
    • Eight years as a corporate trainer for several national business seminar organizations
    • Conducted almost 1,000 seminars in all 50 states and Puerto Rico, focusing on sales and use tax, payroll management, finance and accounting, and business communications
    • M.A. degree, University of Missouri-Kansas City; M.L.A. degree, Baker University; B.A. degree, University of Kansas
    Use Tax: The Hidden Danger in Invoices
    Available on CD format
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