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08 February
If you run a business, you will receive all types of government notices. The more locations you have and states you're in will control the total numbers.
Today we will review tax notices - they are often the main source of dread for business owners and staff. However, it's crucial to keep all notices organized so you can deal with the ones needing a response promptly and avoid potential fines and penalties.
All Businesses Receive Tax Notices
A tax notice is simply any communication you receive about your taxes from a federal, state, and local or city taxing jurisdiction. There are over 80,000 taxing jurisdictions in the U.S. now and growing. Tax notices might be simple reminders of when something is due, or they might be a notification you paid too much or too little and have a balance due.
Many tax notices don't require a response, but some do. If you don't respond, then many jurisdictions will keep sending the same notice until you do.
Getting a tax notice does not always mean you did something wrong, and they are impossible to avoid.
How to Keep Agency Notices Organized
When your business receives a tax notice, it is crucial to ensure the proper person receives it. For example, tax notices related to payroll must go to the payroll department, whereas your finance department should receive anything regarding corporate or income tax.
You must also split notices into categories based on what action must occur. Simple reminders of things that are (or should be) in your calendar don't require the same urgency as ones telling you to submit a form or pay a balance due. If you have a notice you underpaid, it's vital to take care of the balance due as soon as possible, so you don't incur extra penalties and interest.
With traditional manual routing, office staff must immediately open tax notices, make a note of them, and forward them appropriately. Unfortunately, this often results in losing notices, sending them to the wrong person, or forgetting them on a desk for a few days. With automation, notices are scanned into a database and then routed automatically.
Manual Processing
Again, with manual processing, staff need to forward the notices. Notices are also typically put into a spreadsheet to check them off. The person who receives the tax notice acknowledges it in the spreadsheet, then marks it off when appropriate action occurs. For some notices, this might be "filed," but for others, it might be "paid."
It can get very complicated, making it too easy to lose notices. The spreadsheet may not be updated properly, leading to somebody trying to chase down an already completed notice.
Automated Processing
With automated software like NOTICENINJA, each tax notice is scanned into a database when it is received. Even if the physical notice is lost or improperly filed, the automated system will store the digital copy in a central database everyone can access. It will also alert the necessary personnel, who can then log in and process the tax notice. That is faster and significantly reduces the chance of error. As long as the staff is in the habit of scanning notices as soon as they are received, notices will not build up and become intimidating. They will also always go to the right person.
Don't Let Notices Control Your Business
It's very easy for unprocessed tax notices to build up. The stack of notices can become intimidating to deal with, making it time-consuming to prioritize and resolve.
Moreover, disorganized notices can result in fines and penalties if you fail to respond promptly. Many jurisdictions will charge late fees if you don't quickly resolve a balance due. Others will keep sending the notice over and over until you respond, assuming it has become lost. While tax notices are not inherently a major administrative burden, they can easily build up and take a lot of staff time to resolve.
Automated software makes this simple. With good tax notice software like NOTICENINJA, you can streamline the entire process, save time, and ensure compliance.
Keeping your tax notices under control helps keep everything moving smoothly. It also ensures that you don't incur extra fines, penalties, or interest simply because of a lost notice or because it was filed with a reminder that didn't run. NOTICENINJA is designed to solve this problem, to help you control your notices and route them appropriately, so your business doesn't have to pay an extra cent due to fines or fees.
