Sales and Use Tax
Avoid the top 10 filing errors:
- Late Filing - File on time for each collection period, even if no tax is due. When you file on time, you can claim up to $30 as a collection allowance.
- Not Fully Completing the Front and Back of the Return - Complete all information on your return, including your signature and your preparer's signature.
- Not Filing for Each Collection Period - File a separate return for each collection period. Do not skip collection periods or add a partial collection period to the next return.
- Not Providing Discretionary Sales Surtax Information on Back of the Return - If you are reporting discretionary sales surtax (county tax) collected, you must complete the back of your return.
- Inaccurate Computation of Tax Rate - Compute the correct sales tax rate, including discretionary sales surtax (county tax), if any.
- Including Tax Collected with Gross Sales - Tax collected should never be included in gross sales. If you include the tax collected in gross sales, it will increase your amount of tax due and you will receive a bill for additional tax due.
- Entering Transactions on the Wrong Lines - Sales reported on lines A through E of the DR-15 may have different tax rates. If you enter your transactions on the wrong lines, you could receive a bill for additional tax due.
- Calculating the Collection Allowance Incorrectly - Your collection allowance is limited to 2.5 percent (.025) of the first $1,200 of tax due. The maximum collection allowance is $30. If you have less than $1,200 in tax due, your collection allowance will be less than $30.
- Not Computing Penalties and Interest - If your return is late, you lose your collection allowance and you must pay penalty and interest on the tax owed. A minimum penalty of $50 applies, even if no tax is due.
- Not Filing a Zero Return - File a return for each collection period, even if the amount due is zero. This could help you avoid penalties and follow-up contacts from the Department.
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