The internet - and the burgeoning digital marketplace it has created - has broadened horizons and opened doors that wouldn't have been imagined just a generation ago. With just a few clicks of a mouse, you can do business with companies across town or across the globe. This brave new world of e-commerce had originally created difficulties for brick and mortar businesses and for taxing authorities alike.
The SEC ended its formal investigation into Sprint Corp.'s sales tax practices without taking action. This decision comes as the New York Attorney General continues to move forward with a case that Sprint failed to collect and pay sales taxes. Sprint says that the SEC opened an investigation in July 2012 and let the company know last month that it has closed the investigation and had no intentions for further action.
Sprint, the third largest wireless carrier in the country, has been charged with tax fraud for willfully failing to pay a portion of sales taxes owed, according to the complaint filed by the state of New York. Sprint tried to have the case dismissed, but the judge refused the dismissal and instead requested a hearing with the attorneys from both sides later this month. Sprint intends to appeal the decision.
Tax exemptions, like so many other things in life, come in sizes large and small. For large corporations and wealth individual taxpayers, the tax savings involved in properly claiming exemptions amount to some serious money.
Collecting sales tax from customers and making sales tax payments to the government can be a logistical challenge for many businesses. This is particularly true of small businesses, which do not always have the accounting personnel and other staff to handle sales taxes easily.
The tax system is ultimately based on trust. To be sure, the IRS is often aggressive in auditing and investigating taxpayers for failure to file taxes or for alleged errors. So are revenue agents in Texas and other states.