Pursuant to Senate Bill 95 (“SB 95”), the new parameters for Louisiana taxpayers to participate in a sales and use tax multi-parish audit (MPA) program go into effect on July 1, 2022. The legislation provides guidance for the MPA program that was mandated as part of the creation of the Louisiana Uniform Local Sales Tax Board (“Board”): HB 601, 2017 and La. R.S. § 47:337.102.H. HB 601 directed the formation of the MPA program as an objective of the Board but left the specific structure and logistics to the Board’s discretion.
The following is an overview of taxpayer eligibility for the MPA program, as established through SB 95 and formalized by the Board:
- Taxpayers are eligible to participate in the MPA program if they have filing requirements in a minimum of three parishes.
- Taxpayers are ineligible to participate in the MPA program if the
i. Taxpayer is engaged in an active audit in which a Notice of Intent to Audit has been issued prior to July 1, 2022,ii. Taxpayer has an active jeopardy assessment issued against them, oriii. Taxpayer is involved in any litigation with a parish currently under audit.
Qualifying taxpayers that wish to participate in the MPA program must request acceptance into the MPA program within 30 days of receipt of a Notice of Intent to Audit letter. Within the request, taxpayers must disclose to the Board all parishes in which they are registered or obligated to remit sales and use tax. The Board will then contact the disclosed parishes regarding the taxpayer’s desire to enter into the MPA program. If a parish does not respond within 30 days, the parish shall be deemed to have opted out of the program. Parishes may also voluntarily elect in writing to opt out of the MPA program.
Any parish that directly, or indirectly, opts out of the MPA program will not be allowed to initiate an audit of the taxpayer until after the completion of the current MPA cycle. This only applies to parishes in which the taxpayer disclosed either registration or an obligation to register.
Once a taxpayer is accepted into the MPA program, the Board will be responsible for managing the audit, assigning a lead auditor (contract auditing firm), determining taxability, and working with the taxpayer throughout the audit process. Upon issuance of the initial audit findings, each parish has up to 45 days to review the MPA program’s preliminary assessment. After the Notice of Intent to Assess is issued, taxpayers have 30 days to request a joint administrative hearing, including all parishes which opted into the MPA program. If the audit results are not agreed to by all parties after the joint administrative hearing, taxpayers have the opportunity to work directly with the applicable parishes to resolve any outstanding issues through the normal protest process.
After the Notice of Intent to Assess is issued, the Board will also notify parishes that initially opted out of the MPA program (voluntarily or otherwise) of the taxpayer’s audit status. At that time, parishes opting out of the MPA program are permitted to independently audit the taxpayer.
The Board will host a webinar at 10:00 a.m. Central Daylight Time on Thursday, June 30, 2022 to provide additional information about the program. Taxpayers may join the session either by Zoom or teleconference using the below log-in information:
Ryan will continue to work with the Board as the MPA program is implemented and continues to develop over time. If you have questions regarding the MPA program or would like to discuss if the MPA program is ideal for your company, please contact one of your local Ryan representatives below.
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The material presented in this communication is intended to provide general information only and should solely be seen as broad guidance and not directed to the particular facts or circumstances of any individual who may read this publication. No liability is accepted for acts or omissions taken in reliance upon the content of this piece. Before taking (or not taking) any action, readers should seek professional advice specific to their situation from Ryan, LLC or other tax professionals. For additional information about this topic, please contact us at firstname.lastname@example.org