Multi-State Sales Tax Risk: Clean It Up Quietly or Face the Audit?

In this episode of Beyond the Ledger, host, Shardae Layfield, alongside the expertise of DiAndria “Dee” Green (The SALTy Lawyer), breaks down how businesses can proactively manage multi-state sales tax exposure through strategic tools like voluntary disclosure agreements (VDAs) and managed audits. The conversation explores how evolving nexus rules and increased enforcement are creating new risks for companies operating across state lines. Dee shares practical insights on how businesses can limit liability, navigate complex state requirements, and make informed decisions between remediation options. The discussion also highlights the importance of timing, documentation, and proactive compliance to avoid costly audits and long-term exposure. Key  TopicsMany businesses don’t realize their multi-state sales tax exposure until it’s costly.VDAs can limit lookback periods and reduce penalties.Timing matters—once a state contacts you, VDAs may be off the table.Choosing between VDAs, backfiling, or audits depends on risk, cost, and exposure.Managed audits are more time-intensive and documentation-heavy.Lack of awareness keeps companies from leveraging VDAs.Strong documentation is critical for audit defense.Sales tax compliance impacts M&A, due diligence, and valuation.State and local rules vary—expert guidance + automation are key.Stay proactive: Taxability → Nexus → Exposure → Fix → AutomateChapters00:00 Introduction to Multi-State Sales Tax Exposure02:10 Understanding Voluntary Disclosure Agreements (VDAs)08:11 Benefits of Voluntary Disclosure Agreements12:01 Common Misconceptions About VDAs17:12 Operational and Reputational Benefits of VDAs20:34 Exploring Managed Audits20:54 Understanding Audits vs. Voluntary Disclosure Agreements23:44 Key Decision Points for Businesses26:58 The Importance of Timing in Tax Compliance28:31 Best Practices for Negotiating with Tax Authorities32:13 Navigating State-Specific Rules and Nexus36:24 Proactive Strategies for Sales Tax ComplianceResourcesBennett Thrasher State and Local Tax Practice - https://btcpa.net/services/state-local-tax/🔗 Learn more: btcpa.net | Follow Bennett Thrasher for more conversations that move business forward.