Voluntary Disclosure Agreements

Businesses selling products or services in multiple states can face unexpected tax liabilities if you fail to comply with income, franchise, gross receipts, sales and use, property, or other taxes—especially as economic nexus laws expand.

Submitting a voluntary disclosure agreement (VDA)—an agreement between your business and its jurisdictions to limit lookback periods and generally waive penalties during tax reviews—can be one of the most effective ways to voluntarily meet compliance obligations. 

Entering into a VDA and confidently addressing key tax specifics related to your business, can be a complex process, however, that requires an in-depth knowledge of various tax laws.

How VDAs Protect Your Business

Waiting for noncompliance notifications from a tax jurisdiction will likely lead to a more in-depth review and higher taxes, penalties, and interest.

Taking a proactive approach to resolve any tax delinquencies through a VDA can help you:

  • Reduce the risk of future audit assessments
  • Bring down business costs and reduce contingent liabilities from your financial statements
  • Limit a look-back period to the past three to four years
  • Reduce or eliminate penalties and interest
  • Register your business for future taxes
  • Save time compared to an audit or delinquent tax examination

How VDA Processes Work

The decision to enter into a VDA should only come after an in-depth analysis of your business. To determine how you should approach VDAs, our professionals can help examine these crucial areas.

Expansive Expertise for Local Needs

Our team can support you through a single VDA or manage multiple state VDAs concurrently. You can make informed decisions about which states to consider for a VDA with guidance provided before, during, and after the VDA process, helping you remain in compliance past completion.

Collaborating closely with your business leaders, our professionals provide customized solutions to effectively overcome tax challenges specific to your business.

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