Friday, June 26, 2015
So, how many returns DO you file?
As any good seminar leader will tell you, you need to get your audience interacting a little. Now a sales tax seminar doesn't lend itself to forming teams to build bridges, or walking around the room trying to figure out people's shoe sizes. But I do try, at least, to get them to raise their hands once in a while.
One of the things I do is poll the room to figure out the number of returns people file. This gives me an idea about the complexity of their businesses, and how sophisticated they are about sales taxes. So I start out saying "How many of you file returns in more than one state?" Usually about half the class raises their hand.
Then I ask, "How many of you file returns in more than 5 states?" Maybe a quarter of the class responds this time.
Then, "How many of you file in more than 10 states?" At this point, only a few hands go up.
Ever the adventurer, I continue, "How many of you file in more than 25 states?" Usually no hands go up. And if they do, I know that I have someone in the room who knows as much about sales and use taxes as me. So I proceed warily.
This time, I did see one person who was still holding up her hand. I asked her, "OK, how many states do you file in?"
She said, "45 states plus the District of Columbia - plus the local returns." In other words, ALL of them.
The audience gasped. I swear one newbie AP specialist fainted. But I digress.
"Wow. I'm impressed. So how many returns are we talking about?"
"Over 200 a month"
"And what software are you using?" Cause she has GOT to be using software, right?
"None, I do it all by hand - pen and paper."
At this point, a controller joined the AP specialist in a swoon. Heck, even I felt a little unsteady.
After I recovered, I stuttered, "Uh, how?"
"I just pull the numbers off the general ledger each month and drop them into the returns. I allocate about three days to do them all."
Later, I had a chance to chat with her. She had one manufacturing plant at their headquarters, and this particular state didn't have much in the way of manufacturing exemptions. And she sold a product that was pretty much universally taxable. The resale exemption was the only one she had to worry about. And she had nexus everywhere because they had reps wandering aimlessly around the country. So their business was pretty simple, relatively speaking. Aside from the unspeakable drudgery, I could see how she accomplished this amazing feat.
So my friends at Vertex SMB, Avalara and the other software companies are probably getting ready to email me and ask who is this heroic woman, that they might save her from her desperate situation.
Frankly, it was a while back. I just remember she was 10 feet tall and had very strong arms.
The Sales Tax Guy http://salestaxguy.blogspot.com
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