Incorrect Sales Tax Reported

[STEPHAN]

What is the name of your state? FL

I just found an old overpayment of sales tax for a small property. In FL, you pay sales tax (use tax) on commercial rentals.

I should have found that long ago, but it is what it is. My secretary reported income that was not there and paid $59.82 sales tax to the DOR. This was in January 2020 for 12/2019.

What is the SOL on this? Can/Should I correct this?

I just want my bookkeeping to be correct.

 

[adjusterjack]

The sales tax department is the place to ask that question. Might even be on its website.

 

[STEPHAN]

Yes, I have tried it on their website. Also, the online form offers corrections only back to 2021.

I guess an incorrectly paid tax that can not be corrected is a company expense? ;-)

 

[adjusterjack]

Yep. You paid it, you deduct it.

 

[Zigner]

Yep. You paid it, you deduct it.

I'm sure they did back in 2020.

Stephan - you're a businessman. You know that time is money. Do you think that the $ (time) required to fix this is going to be less than the $ ($) that you get back?

 

[Taxing Matters]

What is the name of your state? FL

I just found an old overpayment of sales tax for a small property. In FL, you pay sales tax (use tax) on commercial rentals.

I should have found that long ago, but it is what it is. My secretary reported income that was not there and paid $59.82 sales tax to the DOR. This was in January 2020 for 12/2019.

What is the SOL on this? Can/Should I correct this?

I just want my bookkeeping to be correct.

In Florida, the refund statute of limitation for most taxes, including sales tax and income tax, is 3 years from when the tax was paid. This is explained on the Florida Department of Revenue Tax Refunds Information page, which states:

The refund claim must be received by the Department within 3 years of the date the tax was paid. Some claims have a different statute of limitations: bad debts (12 months), repossessed merchandise (12 months), and enterprise zone expenditures (6 months). For more information, see the Application for Refund - Sales and Use Tax (Form DR-26S ) or the Application for Refund - All Other Taxes (Form DR-26 ) Frequently Asked Questions section.​

​

Under the facts given, you had until last month to file that refund claim. It appears to me that it is likely lost now. If that's the case then you can deduct it on your 2023 federal income return, though you'll save just a few bucks in actual tax from that. That assumes it was not deducted on the 2019 federal tax return. If you deducted the sales tax paid on that 2019 return you cannot deduct for 2023.

​

 

[STEPHAN]

Thanks for your help! It is impressive how you know your stuff!

Missing the deadline by four days is like a warranty claim just after the warranty expired ;-)

I deducted it now; luckily, this is not a significant amount.

 

[STEPHAN]

I'm sure they did back in 2020.

Nope. Done now.

Stephan - you're a businessman. You know that time is money. Do you think that the $ (time) required to fix this is going to be less than the $ ($) that you get back?

Hell no. I just wanted my books straight.

All good now.