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Reverse Sales and Use Tax Audit for Agriculture Industry

Farmer Climbing Combine Steps

A reverse sales tax audit is a detailed review of business operations that may result in sales tax refunds and savings.

Many states exempt materials and supplies consumed in the agricultural production process. But determining what is used or consumed in the process is not always easy, which means producers can overpay tax. Exemptions also vary by state and are subject to frequent legislative changes and department of revenue interpretation, which makes ongoing compliance difficult.

CliftonLarsonAllen can help you analyze whether you have overpaid sales tax on your purchases and prepare a refund claim on your behalf.

Our process includes

  • Developing an understanding of your agricultural processing activity
  • Reviewing accounts payable records, invoices, and use tax accruals
  • Presenting identified exemption areas and recommending next steps
  • Compiling required documentation for submission of refund claim
  • Communicating with the state to drive the refund approval process
  • Providing training to help foster future savings and compliance

The reverse audit deepens our understanding of your business operations, internal procedures, controls, and systems, so we can offer recommendations to improve your operational efficiency.

Audit benefits

  • Provides documentation to pursue refunds or credits for overpaid sales and use tax
  • Opens communication with CLA as an ongoing resource for sales tax questions
  • Identifies potential areas of exposure or overpayments
  • Integrates sales and use tax training tailored to your personnel, industry, and business activities

Project fees

  • Fees may be findings-based (contingent) or hourly.*
  • The contingent rate varies depending on the complexity of your business.

*Findings based fees are restricted in some jurisdictions and for publicly held companies. A consultation to determine the permissible fee structure will be required.