The Southeastern Association of Tax Administrators (SEATA) shares
information to help ensure transactions are taxed fairly across state
boundaries. Member states collect and exchange audited sales and
purchases information for other member states. Customers who are
identified through audit verification are billed for use tax,
penalties, and interest.
The SEATA member states are: Alabama, Arkansas, Florida, Georgia,
Kentucky, Louisiana, Mississippi, North Carolina, South Carolina,
Tennessee, Virginia, and West Virginia.
When a state revenue agency becomes aware of a customer's untaxed
purchase, it bills the customer for the use tax, penalty, and
interest. Use tax is also due when the purchaser pays sales tax, but
the item is brought into a state with a higher rate. For example, if
you charge sales tax at Florida's rate of 6%, but the customer lives
in a state with a higher rate, that state can bill the customer for
the difference.
If your customer receives a bill, a dispute could arise over whose
responsibility it is to collect the tax. Even though you may not be
technically liable, you provide a service to your customers when you
voluntarily register and collect tax.
The SEATA member states exchange information on businesses and their
interstate transactions. If you make sales into a member state and do
not register, you may be audited by that member state. If your
business presence is established in any other member states, you may
be liable for all unpaid taxes, penalties, and interest. If you do not
have a business presence in a state and do not voluntarily register to
collect the tax, your customers could be billed for the use tax,
penalty, and interest on their purchases.
Registration alone does not make you liable for past uncollected sales
tax assuming you did not have a business presence in the state
or collect tax on the state's behalf. If you had a business
presence in the state, you are liable for past taxes.
If you have a past tax liability in your market states, you should
make a
voluntary disclosure.
Contact the revenue agency in each of your market states for
information and registration forms. The
Southeastern Association of Tax Administrators (SEATA)
website also has more information, including links to the agencies.
