How to Win a New York Sales Tax Audit, Despite Poor Recordkeeping

Corey L. Rosenthal, JD, and Lance E. Rothenberg, JD, LLM

A New York sales tax audit can be a grueling experience. The rules are complex, and it often comes down to the records, which are usually voluminous. A sales tax audit is typically a paper audit; the taxpayer must provide adequate documentation to support reportable sales and purchases for the period under examination. This is partly because sales taxes are trust taxes, and vendors are charged, as trustees of the state, with collecting and remitting the proper amount.