Posted By: vande77 on April 25 2014 at 09:53:02 AM
IF it was invested back into the company. That is an allegation by NC, they don't know 100% for sure that that $$$ wasn't paid out to other states if those employees worked in other states and are considered a "Qualifying Employee".
If the employees were working in a different state (salespeople for example), the income taxes wouldn't be owed to NC, they'd be owed to a different state alltogether or multiple states potentially.
Like I stated earlier, due to tax laws and such, things are VERY fuzzy when it comes to sales and income taxes.
Florida and South Dakota are 2 states that don't have income tax. However, just becuase you are a resident there doesn't mean you don't owe taxes to another state (I could live in FL but work in CA, IA, OH, IN, and PA for a production company based in AZ (also has no income tax if I remember correctly). I don't owe income tax in FL (but I do in all those other states and I have to file an income tax return for each and every one of them). My employer (if not paying me on a 1099) has to pay in payroll taxes to those states on me as well. If they are paying me on a 1099, they just have to report it to the state, they don't pay any payroll taxes on me.
Same goes for Sales Tax. In Iowa you must have a building within the state in order to charge Sales Tax (so Amazon.com for example collects no sales tax in Iowa). It would be against the law for them to collect Iowa Sales tax, but it is also illegal for them to collect sales tax for another state from me as well. Therefore they could sell millions upon millions of $$$'s worth of product in Iowa and not owe sales tax to Iowa or (insert state here) because they cannot legally collect it.
When doing an audit, the state may only be looking at gross receipts and saying it doesn't add up and "jumped the gun" on arresting her (we won't know until it goes through the court system if it makes it that far).
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