State Tax

Managing State Tax Audits (Portfolio 1730)

  • This Portfolio focuses on the state tax audit process and provides practical insights into planning for and managing state tax audits.


Bloomberg Tax Management Portfolio, Managing State Tax Audits, No. 1730, focuses on the state tax audit process and provides practical insights in planning for and managing state tax audits.

This Portfolio addresses state tax audits primarily in the context of income and sales and use tax audits. The authors describe the state audit process and provide planning opportunities that can minimize the time, expense, and exposure of a state tax audit. While addressing procedures to follow during a field audit, the ideas discussed herein also apply in responding to questions during a desk audit. It also takes a look at some emerging, nontraditional audit techniques.

The Portfolio discusses in detail the audit selection process, how an auditor prepares for an audit, and the types of preparations a taxpayer should make before an auditor walks in the door. It sets out the ground rules all parties should follow before, during, and after an audit. The Portfolio also discusses the various audit techniques used and how the different audit techniques may impact a taxpayer’s net liability. In addition, the Portfolio discusses computer–assisted audit methods and how the growing reliance on computer systems is changing how audits are performed. It provides key points on managing an audit, bringing an audit to closure, and how to proceed in the case of disputed audit results.

This Portfolio may be cited as Amato, Yanover, and Simonetti, 1730 T.M., Managing State Tax Audits . Within the Multistate Tax Portfolio Series, however, references to the Portfolios will include only the Portfolio numbers and titles.

Table of Contents

1730.01. Introduction
1730.02. Pre–Audit Preparation
1730.03. Waivers Of The Statute Of Limitation
1730.04. Relating To An Auditor On A Personal Level
1730.05. Managing The Audit
1730.06. The Exit Conference
1730.07. Getting To An Agreed Audit
1730.08. Preparing For The First Protest Level
1730.09 Using Outside Advisors
1730.10. To Litigate Or Not
1730.11. Post-Audit Action Items
1730.12. Non-Traditional Audit Programs
1730.13. Conclusion

Frank Yanover
Senior State Tax Attorney (Retired)
General Electric
John Amato
State Tax Counsel
General Electric Company
Marc Simonetti
Sutherland Asbill & Brennan LLP
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