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State Board of Equalization


The SBOE is the state taxing agency that handles sales tax audits and sales tax collection efforts. A Los Angeles sales tax attorney can guide you through a tax audit or collection matter.

Sales Tax Audits

The SBOE is very active in conducting audits and has a variety of methods to conduct audits and assess taxes to businesses. One method that the SBOE often uses is the mark up test. The SBOE auditor will obtain the cost of goods sold and then attempt to formulate an average mark up of those goods. The auditor will obtain the current mark up by inspecting the sales price of goods at the current rate. Then the SBOE auditor will apply that mark up rate to the cost of goods sold reported on the businesses tax return for the last several years.

In addition, the SBOE has a variety of other mathematical methods to propose an increased tax assessment. The SBOE can also attempt to personally assess the business owners with the tax liability of a business. If the SBOE does attempt this personal assessment, you have appeal rights. If you or your business has an SBOE tax liability, you don’t have to pay the entire amount in one lump sum. You can pay the tax liability in monthly payments based on your ability to pay. A Los Angeles sales tax attorney can negotiate an affordable payment plan for you.

In a sales and use tax audit, for example, the auditor wants to determine the following about the returns you have filed:

  1. Did you report all gross receipts from sales of tangible personal property and taxable labor and services?
  2. Did you report the cost of all business equipment and supplies that you purchased without tax either from out-of-state vendors or for resale that would be subject to use tax?
  3. Did you properly claim deductions?
  4. Did you properly allocate local tax?
  5. Did you use the correct rate of tax when reporting sales in special tax districts?
  6. Did you properly apply tax to your sales and uses of tangible personal property?

We can help you navigate these questions to obtain the best results. For a helpful reference, you can review the SBOE audit procedures manual.

SBOE Tax Liability Collection Matters

If you receive a notice of tax liability from the SBOE, they can attempt to issue levies against your bank account, issue liens, and issue wage garnishment orders. However, if you cannot pay the entire amount in one lump sum, you are entitled to request a monthly payment plan. We can help you obtain an affordable payment plan that works for you. We are skilled in a plethora of tax collection matters, including successor liability, installment agreements, and lien and levy defense. If the SBOE has issued a levy against you, we can help you get it released. Whatever you matter may be, we can fight on your behalf. You can review the SBOE collection procedures manual.

Contact a Los Angeles Sales Tax Attorney Today

We have extensive experience in SBOE audits and collection matters. Contact a Los Angeles sales tax attorney at Disparte Tax Law today for a free consultation.