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I would say that the procedures are different for every state but I am familiar with a Florida sales tax audit through a certified audit program which allows a private CPA to be hired by the business to "certify" that you are in compliance. At that point the DOR will abate penalties and interest if you pay any taxes found during the "self-audit" and the DOR will not re-audit that period. I have no idea if this program exists in other states but just for the heck of it...What is your question?
I am. I used to audit sales taxes. Does that answer your question?
I'm guessing that you are a business and you have received an audit notice and you want to know how you will be audited. Well - that depends mostly on your industry and size, state.
Generally, the auditor will look at your financials - balance sheet and income statement, and then your sales tax returns to see if they are consistent. Then he will take a sample of your sales and look at the source documents to establish an 'error ratio.' If that ratio is good, he might just say its fine and go away. If the ratio is bad, he will multiply it by the total sales and either propose additional tax, or call in more auditors and ask more questions and start looking at your bank account transactions or other sources and applications of funds.
If you have a more specific question, feel free to ask.
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