“Gap period” sales and use tax returns

April 7, 2016|Sarah Evans

If you have recently undergone a Wisconsin sales and use tax audit, the Wisconsin Department of Revenue will likely be expecting “Gap period” sales and use tax returns (Form ST-12).

Modify your systems to include review of the types of sales and purchases adjusted for on the audit report. If necessary, file amended returns to reflect additional sales and/or use tax for tax returns that have already been filed for subsequent periods. If your sales and use tax reporting system is not modified to include the required types of items included as additional taxable measure on your audit report, penalties may be applicable for future audit periods.

New registrations

Sometimes as part of an audit, you are required to register and hold a consumer’s use tax permit, even if there are no taxable sales. The business is provided with an Application for Business Tax Registration, Form BTR-101, and must begin to file returns that cover periods after the audit. If you don’t sign up for your online profile and begin to file returns to report use tax for the periods after the audit period, it is likely that you will receive a Notice of Estimated Tax Amount Due. It is imperative that you don’t ignore this notice. If you don’t respond to the notice in some manner, you will be charged estimated tax, penalties, interest and collection fees, and the state may take collection action against you.

How can Schenck help?

Schenck has sales and use tax specialists who can assist you in:

  • Setting up your online profile
  • Quantifying your liability
  • Preparing documentation to support potential refunds—and determining if they should be obtained from the vendor or from the Wisconsin Department of Revenue
  • Preparing documentation to support underpayments
  • Preparing amended returns
  • Training to plug gaps in your sales and use tax compliance to avoid future tax, interest and penalty liabilities

Questions?

If you have any questions regarding gap period filing, your sales and use tax audit, or ST-12 compliance, contact Sarah Evans, State and Local Tax manager at sarah.evans@schencksc.com or 414-465-5561 or ask for any member of the Schenck State and Local Tax team at 800-236-2246.


Sarah Evans, CPA, has more than 25 years of state and local tax experience. Her experience includes coordination of sales tax audits and reverse audits as well as research, planning and compliance related to sales and use, property, income and franchise taxes.