"Your Tax Engine Doesn't Know It's Wrong."

Is Your Sales Tax "Solved"—Or Are You Just One Audit Away From Finding Out It's Not?

In this episode of The Sales Tax People Podcast, Paul and Ryan break down exactly what to look for when choosing a sales tax solution—why matching platform complexity to your business matters, how misconfigured tax engines silently create massive exposure, and why collaboration with a true sales tax professional is the single most important investment you can make. Plus, they recap their epic golf outing at Sand Hollow Resort (birdie on eighteen to beat the course! 🏌️).

📌 Questions We Answer in This Episode:
• What should I look for in a sales tax software or service provider?
• How do I know if my sales tax system is too simple—or too complex—for my business?
• What happens if my tax engine was never set up correctly?
• Why is "set it and forget it" dangerous for sales tax compliance?
• How do remote employees create new sales tax obligations?
• What's the difference between front-end tax collection and back-end filing accuracy?
• How often should I review my sales tax setup?
• What is use tax and why does it matter?

🔗 Related Resources:
📖 What Is Nexus?
📖 What Is Economic Nexus?
📖 Over-Collecting or Under-Collecting Sales Tax: The Risks
📖 The Complete Guide to Sales Tax Management in 2026
📖 What Triggers a Sales Tax Audit?
📖 How to Prepare for a Sales Tax Audit
📖 Sales Tax Voluntary Disclosure Agreements

🎧 Related Episode: Sales Tax Peace of Mind Doesn't Happen by Accident

💼 See how Coburn's Supply Company reduced a $1M+ tax liability to just over $100K with the right sales tax partner.

💼 See how Acima achieved compliance across 240+ jurisdictions during their $1.65B acquisition.

📋 Learn more about our Sales Tax Management Services — 6,000+ clients, 30+ years of experience, accuracy guaranteed, no long-term contracts.

🚀 Ready to find out if your sales tax setup is actually working?
👉 Book a Demo for more customized help
👉 Find us on LinkedIn

#SalesTax #SalesTaxCompliance #Nexus #EcommerceTax #SalesTaxSoftware #TaxCompliance #SmallBusinessTax #SalesTaxAudit #UseTax #TheSalesTaxPeople

Transcript

– Golf recap: Sand Hollow Resort, scores, and that clutch birdie on hole 18

SPEAKER_02 0:00

So we're we're rolling? What do we do now?

SPEAKER_03 0:03

You're listening to the Sales Tax People Podcast.

SPEAKER_00 0:10

What if you were overpaying your sales tax by $90,000 a year and you didn't even know it? On this episode of the Sales Tax People Podcast, the guys break down exactly what to look for when choosing a sales tax platform and provider. Whether you're a controller, a VP of finance, or an advisor helping a client navigate their sales tax exposure, this one's for you.

SPEAKER_02 0:30

First of all, we played golf for the first time in a long time. Well, that was epic.

SPEAKER_04 0:34

It was okay, fun.

SPEAKER_01 0:35

We shouldn't do that. It was fun reading with you guys. Shout out to San Hollow Resort for allowing us to come over there and play golf. That was sweet. We're trying to pull in sponsors. Maybe. The highlight to me was hole eighteen when we needed to make Birdie to beat the course. Specifically, you're shouting out that moment just that very moment, because that was the the moment you and you and Jenner had missed a putt, and so it was like this was it. If we're gonna beat the course, then I have to make the putt. And you did. And I was really nervous, but came through and right in the front of the cup, just a half a rotation in.

SPEAKER_02 1:14

It was pretty cool. It was quite beautiful. This isn't the most humble I've ever seen, Paul.

SPEAKER_01 1:18

But I that's not what you call a brag. Yeah, that was not a humble brag. I was it was just a very proud moment for me, you know. It was a solid that we could come through and we could beat the course.

SPEAKER_04 1:29

That moment is special no matter how poorly you play, right? Yeah, you're coming in, you've shot a hundred. Yeah, right? But you birdie, the last hole. Right? You're coming back for sure. You're coming back, too. Birdie's feel good no matter when they have. Even better.

SPEAKER_02 1:49

What'd you shoot even par? Oh, we were one under.

SPEAKER_04 1:52

Oh, we were one under.

SPEAKER_02 1:53

We beat the course.

SPEAKER_04 1:54

We beat the course. It was three of us. We beat the course and we beat Danny. You did. What did you shoot? 73. It was one over.

SPEAKER_02 2:07

Oh my gracious incredible. With a very ugly end of the front line. I think I went well, I went par or no, I went bogey, double bogey, and a three-hole stretch on that front side. And then yeah.

SPEAKER_04 2:21

But for Danny, that's ugly. Yeah. For most of us, that's normal. Yeah. We loved that's par for the hacking. We loved the people that we were with. And even if we shot a hundred, we're happy.

SPEAKER_02 2:35

That would have been good. Yeah. It's true. I I was you said you have a lot of work to do, but I that was the most impressive thing. Like the thing that stood out the most is two things. First of all, like just the way you're playing with your new approach to your setup and your swing. And the other thing about that is the fact that I think you found the instruction on Facebook, right? You just found some random guy on Facebook. Yeah. Tell us about that.

SPEAKER_04 3:06

Uh well.

SPEAKER_02 3:07

That doesn't usually work. It usually is like not a good thing for someone to like be like, oh, here's this reel, and I'm gonna check it out. And that sounds good. I'm gonna try that. It usually doesn't work out.

SPEAKER_04 3:18

Well, first and foremost, I appreciate that within my algorithm are golf instructors. Uh number two, I appreciate that there are golf instructors out there that are not trying to help me recreate a swing that

– Finding unconventional golf instruction on social media (Jim Venatos shoutout)

SPEAKER_04 3:32

the pros use. Yeah. Because I'm not as athletic as the pros, and I'm not going to be able to swing as hard as the pros. So I need a swing that works with my anatomy, right? So anyway, that's what this guy does. His name is Jim Vanitos. Venitos? Vanitos. I don't know. Shout out to Jim. Thank you, Jim. He's been instructing for about 30 years, and he's just come up with a swing approach. The way you approach the ball, the way you swing and set up, and your balance. It's really just a couple of things that you have to remember in the swing, even though I can't quite remember them. Uh it's simple. And I found him on uh social media. Bam. He's on Facebook and Instagram. And I now follow him.

SPEAKER_02 4:22

Jimmy. We gotta find Jimmy.

SPEAKER_04 4:25

He'll be on the podcast someday. Yeah, bring in Jimmy. Or you'll be on his. Shout out to a future colleague of mine who was here back in the 90s. A future colleague. Did I say future? Former. Former colleague. Former. That would make more sense.

SPEAKER_01 4:43

Hey, we're about to hire somebody. Let's go.

SPEAKER_04 4:45

Yes. Neil Stevens. Do either of you have y'all met Neil Stevens? Yeah. You did? Yeah, yeah, yeah.

SPEAKER_02 4:53

He worked at Piser Johnson? He did. Yeah, I don't know.

SPEAKER_04 4:56

If you go out and watch Jim Benitos, you'll be reminded of Neil Stevens. Oh, no kidding. Just a shout out to good old Neil. Um, he called me Action Jackson. And I can't remember what I called him. Probably just Neil. No.

SPEAKER_02 5:13

It's probably something inappropriate.

SPEAKER_04 5:15

I called him Nick. What? He called me Action Jackson. He called me Jackson instead of Jason, and I called him Nick. Instead of Neil. Yeah. Okay. Good guy.

SPEAKER_01 5:26

Okay.

– Shoutouts: Neil Stevens, UTA accounting, and old colleagues

SPEAKER_04 5:27

We both graduated UTA with accounting degree. Shout out UTA.

SPEAKER_02 5:33

I mean, speaking of accounting.

SPEAKER_04 5:35

Nick, if you're out there, shout out Nick.

SPEAKER_02 5:38

Hopefully he's listening at some point.

SPEAKER_04 5:41

He was in sales tax until he retired, so he might be one of our tens of followers. He might be one of our tens of followers.

SPEAKER_02 5:50

Yeah. Okay. Or dozens. Trying to get to the hundreds. We'll see. Um speaking of accounting. Accounting? And speaking of like finding what works for you, the that is the question of the day is when you are looking for sales tax advice for a sales tax service provider, sales tax software, just generally speaking, if I'm a company or I'm an advisor that's helping a company find the right sales tax fit right for all the services and software that you might need, what are some of the main things that you should look for? If you're that company that, you know, you're the controller, you're the VP of finance that's in charge of sales tax for your company, or you're that advisor that you know the the your company, your client is looking to you for you know sales tax help. What are some of the things that I should look for?

SPEAKER_04 6:53

Paul,

– The big question: What should you look for in a sales tax solution?

SPEAKER_04 6:54

you want to begin or you want me to begin?

SPEAKER_01 6:57

You can begin.

SPEAKER_04 6:59

I have a few things in mind, but two things come to mind. Um I'll say right off the bat, you're not looking for a set it and forget it solution. No. Uh we say here that uh if you set it and forget it, that you may regret it, right? So you are looking for uh providers who have implemented technology and automation that uh can be really powerful and useful and create some efficiencies uh in the processes and the systems that you have. But you're also looking for a partner um who can legitimately take the sales tax responsibility off your plate. Right? We we really want to help companies gain peace of mind when it comes to sales tax. So the idea is uh combination of what would I say is platform and people. So you're looking at the platform, what it offers, what it provides by way of efficiencies and automation, and you're looking for the right people uh to help you with that system and to ensure that the system stays in place. So right off the bat, what

– "Set it and forget it? You may regret it." — Platform + People

SPEAKER_04 8:05

comes to mind is the right platform and the right people.

SPEAKER_01 8:09

Yeah, when you talk about platform, I think initially, right, right um initially I think of of Nexus. You know, where do you have Nexus? Where do you have a tax responsibility? And so depending on when the products and services you're selling, you want to make certain that you have a system that's capable of collecting the right amount of tax and the right place where tax needs to be collected from the from the right jurisdictions. That's huge. Uh and that can be a simple, you know, I'm an e-commerce company, and that could be as simple as a shopping cart, uh, Shopify tax being probably the most common for us. Yeah, that works great. Yeah, it's it's gonna collect tax on the s of this speaker, um, tangible person property, pretty simple and straightforward. So it can be something simple and basic like a shopping cart, or it could be something completely robust because you're providing uh construction services on a lump sum or separated

– Nexus, taxability, and matching system complexity to your business

SPEAKER_01 9:03

contract. And so you need a pretty robust system. So you got to make sure you have a right platform that's that's collecting the right amount of tax on the right products and services that you're selling.

SPEAKER_04 9:13

Yeah, complexity matters, right? You you you don't want a system that's so simple that it doesn't take into account some nuances or complexity in what you sell, right? Right. We focus on where you sell Nexus, what you sell, the taxability of those items, and how you sell it, right? What platforms are they on? Are you the responsible party for collecting that tax? So when you're thinking about that, you don't want a system that's so simple it's not managing some of the nuances or complexities that you have. Yeah. But if you're just selling microphones across the US, maybe in Canada, around the world, then you need something that can essentially impose the tax in the right jurisdiction at the right rate. Yep. But probably everything you sell is taxable unless you're collecting a certificate from somebody that's buying from you. Right. Right. So you also then don't need the most robust system out there. Yeah. Um and so you have to be careful when you're looking at that because people will try to sell you on simple when your situation might be more complex. Yeah. Or they might sell you on complex when it your situation is pretty simple. I think both of you have said it. Some of the the most peace of mind that people have had are ones that we have a chat with. We learn a little bit more about their business, we learn where

– When simple is enough vs. when you need something robust

SPEAKER_04 10:28

they sell, what they sell, and how they sell. Yep. And we say, you're actually in pretty good shape. Yep. You probably don't need to do anything right now. Yep. And they're like, ah, we're so glad we found you guys. Thank you for this opportunity to chat with you because um, you know, we've been told that we need this, this, this, and this, right? Right. Which is uh can be pretty significant.

SPEAKER_01 10:48

So I just ran into a situation earlier this week, actually, with a client who said, you know, I was told I need to set up this, this, and this, and this. But what I chose is I'm just gonna charge a flat rate in each state. And I was like, oh okay. So you're gonna disregard all the local taxes and the different rates and you're just gonna Yep. As long as we just collect 7%, then we're okay.

SPEAKER_04 11:11

Allow us to be your first, second opinion. Yeah, whether that's the decision that you make. Yeah, you're okay until you're not okay. Right? Yeah, right? Yeah. Yeah. Well, in sales tax, um, you know, this this is a pretty consistent theme is exposure and responsibility

– Why delaying the sales tax conversation makes exposure worse every month

SPEAKER_04 11:29

uh it is quiet until it's not, right? It can get real loud real quick. Yeah. Um, and so I like your question because it at least has someone thinking about what to do to deal with sales tax versus the person that's decided it's not an issue. And I don't need to worry about it. I don't even need to have a conversation about it. Or some people don't want to have a conversation because they fear the responsibility or the exposure could be pretty significant. But in sales tax, every single month that you take that position is another month where that exposure can grow along with penalty and interest.

SPEAKER_02 12:09

Yeah, I find it even with um, especially say an employee of a company that has been at the company long enough and they've been in, you know, quote unquote in charge of their sales tax, and it becomes more and more concerning, or they're more and more afraid to actually dive into it to see how bad it is. Yeah. And the fact of the matter is, like the longer you wait, the worse it's going to be. Yeah. And I'm talking about the longer you wait to even have the conversation, really understand what's going on with your company. Yeah. And not necessarily how bad it is, but more tying it into what we're talking about here of what is really the best setup for me? What are the questions that I need to be asking or that I need someone to ask me? And you know, what's the true like process for me to come to that point of both understanding exactly what's best for us and then taking the right steps to put the right platform in place.

SPEAKER_04 13:09

Yeah, I mean the fear with someone at that level in that situation is that they might come across as incompetent or the villain in this story. And really, uh, if if they will uh take a step forward, they they could end up being the hero of the situation.

SPEAKER_02 13:25

Right. Yeah, the hero's journey is is very real in what we do. Yeah. In our entire process, it's very much a that flow, you could say, that that path and that journey of identifying,

– The fear of looking incompetent vs. becoming the company hero

SPEAKER_02 13:41

you know, just issues, looking at the big picture, you know, the macro and the micro, you could say with sales tax, it takes into account the platform, you know, you mentioned talking to companies that we we look through everything and just say, you know, you're in a pretty good spot. Yeah. You can peel back some of those layers and go into more detail even with some of that. That's, you know, say someone that's on Shopify and they're using Shopify Tax. Yep. And we just had a conversation yesterday with a client that's on Shopify Tax, and we brought them on recently as a client. It's like, it's probably not enough for you because it there's enough nuance to what they're selling with supplements and protein powders and protein bars and to where like they need a more sophisticated tool. Right. And then there's the other side of that where we've

– The hero's journey in sales tax compliance

SPEAKER_02 14:34

recently had clients that are using one of these more robust sales tax engines, and the one in particular comes to mind is paying around a hundred thousand dollars a year because of their transaction volume. And it's like, you know what? What you guys are selling is straightforward enough and simple. Like you don't need that tool. Yeah. And you know, you might as well pay five grand a year, and you know, no one's gonna be upset about saving 90 grand. Yeah, it it all comes down to you mentioning people and platform, and we talk about it constantly, both internally and what we're doing, you know, with our team and our employees, and it's very much a part of the answer to you know, the question that we're talking about here of like what is the best approach for you? It's simply put, yes, look at the platform that you need to be on. Look at the platform that maybe you need to have in place internally, and without a doubt, talk to some people.

SPEAKER_04 15:32

Okay, you just changed my mind. I I told you there were two things that you need. Uh there's actually just one thing that you need. I'm I I changed my answer. It's collaboration. There you go. Um, if you want to build some confidence, you want to collaborate with a sales tax professional who can who's agnostic to the systems and the approach, but they're not agnostic to your situation and your peace of mind, right? Yeah. They're really looking for the right answer for you to help you gain confidence in the decisions that you're making. And so you really need a good partner to collaborate with when it comes to what is the best approach to the best system.

SPEAKER_01 16:10

Yeah. For me. There's a lot, there's just so many different aspects to it. I mean, you talk about that where you have a tax responsibility, where am I responsible to collect tax, but what am I responsible to collect tax on? And what am I liable for? But then you get into who you're selling to, right? Well, I sell to government entities, or I sell to these uh 5013 C's, or I sell them to these customers. Well, you can get this certificate or that certificate to avoid the tax. So you now you get into certificate management. Uh

– Collaboration: the #1 thing you actually need

SPEAKER_01 16:39

then you get into you know used tax, and I purchased this for resale, but then I ended up using it or giving away as a promotional item or as a as a giveaway. And now you have to, you know, assess used tax liability. So you got the use tax aspect. There's just so many different things. I have a quick part. Is it is it used tax or used tax? Use. Use. Use tax. Use guys. Use tax. Use guys need to pay tax because you use that item. Well, it's tricky because that it's a consumption tax, right? So it's based on the

– Certificate management, use tax, and frequently missed obligations

SPEAKER_01 17:09

use of the item. So it's a used tax, but you used it, so it's a used tax.

SPEAKER_04 17:15

You see what I did there? I I see what you did there. You you used both pronunciations very well, by the way. It's crazy. Yeah, use tax is probably something that you know we could cover on another episode. But um, in the world of post-wayfare, what we're dealing with most of the time is uh where you sell, what you sell, and how you sell it, because there's this responsibility that you're gonna have across the the US and Canada to collect and remit tax on what you sell. But use tax is another important aspect of the sales and use tax um realm. And um when you have a responsibility to pay tax on items that you've purchased and and um maybe you didn't pay tax at the time of the sale, right? But you use it in such a way that it requires uh a remittance of tax. I don't want to delve deep into that, but I'm glad you brought it up because it's an important factor on the whole system for sure. Making sure that you're looking at both sides of the coin.

SPEAKER_02 18:16

Yeah, it's a perfect example of why collaboration is uh what you need when it comes to you know finding the right sales tax process for you. Yep. Like what another way to you know present that question is what does sales tax compliance look like for you as a company, right? Or again as an advisor, what does it look like for your client? It's very important to have a collaborative discussion like this that's specific to your company and all the facts. Right.

SPEAKER_04 18:44

And it's not just about um you don't want to have this conversation because you're unsure about your exposure, your responsibility, your your situation. If if you believe that you have sales tax solved in in your company, we still want to have a conversation with you. You still want to collaborate and walk through all of the steps to make sure that you've got all your bases covered. The the last thing you want is um you you got registered, you got compliant, you got set up, you have the system in place, you believe that you have

– What does sales tax compliance actually look like for YOUR company?

SPEAKER_04 19:18

it solved, and then four, five, six years down the line, uh you're getting audited. Right. And then and then you find the blind spots that weren't observed. So my my position is uh, and that's why my new answer, my number one answer is collaboration. Whether you're unsure and you don't have a system in place, or you do have a system in place, you want to collaborate on your situation and your system.

SPEAKER_02 19:43

Yeah, the the worst problems that we've seen companies in in recent history, especially. I know as I bring this up, you guys are gonna think of the same companies and you know that are now clients of ours. And the worst problems that we see are from companies that think they have it figured out, or they had an advisor that was telling them, and in most cases, if not every case, the advisor thought they had it figured out. And in fact, they didn't. You know, and in one case, it's the advisor just doesn't have enough expertise and to to really know the questions to ask, and to know where

– Blind spots: advisors without deep sales tax expertise giving false confidence

SPEAKER_02 20:24

the blind spots could be, and they don't look in the right places and they ignore a lot of the important pieces that need to be you know approached.

SPEAKER_04 20:34

No, that's brilliant. If if you're a taxpayer or company out there, or you're a trusted advisor to uh companies and taxpayers out there, uh collaboration is still the right answer, right, with a sales tax professional. Yeah.

SPEAKER_01 20:49

You'll want to make certain you get the front-end system all correct, right? You're collecting it, you're administering it, but then also on the back end, we call it the front and the back end, but uh from the remittance perspective, you want to make certain that you got that platform all correct as well. Because you want to make certain that your filings are on time, they're accurate, they're correct, you're reporting the proper schedules, local jurisdiction, and so on and so forth. And there's a lot of different softwares and solutions out there for that as well. Some very cheap ones, some very robust ones, some wide glove services like ours that we provide. Um, all of that coupled with you know the preparation for audit. I mean, there's just a lot of different aspects that that come into being in compliance.

SPEAKER_04 21:31

Yeah.

SPEAKER_01 21:32

Yeah.

SPEAKER_04 21:33

So you want to collaborate, and then you want to focus on the right platform or forms and the right people.

SPEAKER_01 21:41

Yeah. Yeah, a long time ago I I used to live in Texas, where next to you. We miss you. I miss Texas.

SPEAKER_04 21:49

But when I was in Texas talking use guys instead of y'all guys, I don't know what's going on here. Use tax, use guys.

SPEAKER_01 21:56

Where I was going with that was in Texas. We miss y'all a lot. I miss you guys. It's Texas in general, but the people. Anyway, that's a long story. But in Texas, you every three months, six months, maybe every year, you're you're constantly checking because of the deregulation of energy the the latest and greatest electric rates. Yeah. Who's going to provide the cheapest rates? Because it all comes from the same source, but with the deregulation of electricity. You got a thousand resells. So every you just get used to, used to use. You get used to, no, you get used to just checking the latest rates for electricity. But it's no different in sales tax with your business. If you've got somebody who's in the accounting space managing that, you it's a constant reminder to just check it out. Just hey, what's what changed? What products are we adding? What locations are we adding? What platforms are are new to the market? Should we consider a switch? What's working, what's not working? Yeah. And just do a refresher. At minimum, you ought to do that every year. But I mean, for growing businesses, you ought to be doing it every month or every three months.

SPEAKER_04 23:14

You bring up a big one that creates some exposure and that is not looking at the mapping of your products and SKUs. Yeah, that's a big tax codes that are inherent in your self-standing platform. For sure. You you've added SKUs, you've changed SKU.

– Why you need regular review cycles (SKU mapping, new jurisdictions, platform fit)

SPEAKER_04 23:29

For sure. Um tax uh taxability has changed. Yeah. Um, you've got different situations that come up. So yeah, there needs to be a consistent view of that.

SPEAKER_02 23:40

Or it was set up three years ago and you weren't involved in it, yeah, or the right people weren't involved, and the mapping never even got completed. Yeah. We see that constantly where someone's again paying a lot of money for a great tool, yeah, but it never got set up correctly. In fact, it if you don't set it up at all, it's usually these tools are gonna set as a default to just tax everything everywhere. Yeah. And so what's the point of even having that tool? Yeah, you're you're literally just burning and wasting that money because they're you're not getting any of the value out of what the tool is meant to do. Yeah.

SPEAKER_01 24:17

The other thing that's big is that you know, uh oftentimes there's a new hire, and so HR isn't communicating with the accounting department. Hey, we hired so and so and they're working from home now in New York. Well, that changes your physical footprint, requires you to register for not only unemployment, corporate income, whatever it may be, but also sales tax. So something to to keep in mind. A lot of times businesses overlook the physical nexus given the fact that we have economic nexus in our market today. Yeah. So they're like, well, I don't I don't have a responsibility. I I didn't I didn't make more than $100,000 or generate $100,000 in revenue or $500,000 or whatever it may be. So just from a an overall footprint perspective, uh company perspective, making certain that one hand is talking to the other hand. Yeah. Super critical. Oh, they do. They do.

SPEAKER_02 25:14

They at least speak body language, right.

SPEAKER_03 25:22

Thanks for

– Physical nexus triggers: remote employees creating new filing obligations

SPEAKER_03 25:23

hanging out with us on the Sales Tax People Podcast. If you want to talk about sales tax, or maybe you have an experience that goes along with something we talked about today, or maybe you just want to hear about how Paul's day is going, make sure you send us an email to podcast at sales.tax, or you can text us at 949 355 5098. See y'all again soon.