In this episode of Beyond the Ledger, host, Shardae Layfield, alongside the expertise of DiAndria “Dee” Green (The SALTy Lawyer), breaks down how businesses can proactively manage multi-state sales tax exposure through strategic tools like voluntary disclosure agreements (VDAs) and managed audits. The conversation explores how evolving nexus rules and increased enforcement are creating new risks for companies operating across state lines. Dee shares practical insights on how businesses can limit liability, navigate complex state requirements, and make informed decisions between remediation options. The discussion also highlights the importance of timing, documentation, and proactive compliance to avoid costly audits and long-term exposure. 

Takeaways

• Many businesses don’t realize they have multi-state sales tax exposure until it becomes a costly problem.
• Voluntary disclosure agreements (VDAs) are powerful tools that can limit lookback periods and reduce penalties.
• Timing is critical—once a state contacts you, VDA eligibility may no longer be available.
• Businesses must evaluate VDAs, backfiling, and managed audits based on exposure, cost, and risk tolerance.
• Managed audits can be significantly more time-consuming and documentation-heavy than VDAs.
• Lack of education is one of the biggest reasons companies fail to take advantage of VDAs.
• Proper documentation is essential to support tax positions and defend against audits.
• Sales tax compliance plays a key role in due diligence, M&A readiness, and company valuation.
• State and local tax rules vary widely, making expert guidance and automation critical for scaling businesses.
• A proactive, lifecycle approach—taxability → nexus → exposure → remediation → automation—is key to staying compliant

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