Sales Tax on business

[shadows]

What is the name of your state? New York

I recently sold a business 8 months ago. 3 months after I sold it I got audited. Now they are stating based on rent and location I owe past due sales tax because I don't have enough documentation to prove otherwise. I had refinanced my home 2 times just to support the business because it wasnt making the money to stay in business. That is the reason I sold it. the money from the refinance was not put into my bank account because I was scared of past debt that they would freeze my accounts. So i kept the money in a safe at home and deposited into the business account when needed. How can I prove this?? I showed them the refinancing papers but they are stating I could have used that money for anything since I dont exactly have proof the money I deposited was from the refinance and not money the business was earning. Also I had borrowed money from friends and family for the business and paid them back after i sold the business. Is there anyway I can prove that as well since most of it was cash money?? Can anyone help me with this??

[abezon]

A tax attorney could have helped you before the audit. Now, you've probably said something to torpedo yourself. But consult with a tax attorney anyway. You'll probably end up in court, since the state has already decided the facts in its favor.