2022 NFL Flag Summit Sales Tax FAQs

For the past two years, NFL Flag has hosted a summit with the goal of bringing its leaders and leagues together to collaborate on the best ways to support and improve their industry.  Each year Agile has attended in order to provide information and perspective on sales and use tax. This year's summit brought Aaron and Kevin to New Orleans to address the queries and concerns of leagues nationwide. After their presentation, several individuals had additional questions on how they can be as successful with their sales tax as they are on the field. This is a one-stop shop for answering those questions!

What does the sales tax certificate look like that we need to upload and where can we find it? Is it state by state? 

The look of sales tax certificates varies by state. In order to obtain one, you will need to register with the state. Most businesses can fill out an online registration form. Some states will require a business that is based out of the country, a contractor, does not have an FEIN, or has a representative member without an SSN to file paper forms. Here is a checklist of the basic information you will need in order to register:

• Legal Entity Name & DBA
• Physical & Business Mailing Addresses
• Business Phone Number
• FEIN
• Website url
• Corporation Type
• Date and State of Incorporation/Organization
• NAICs Code(s)
• Business Description
• Accounting Method (Accrual or Cash)
• Accounting Period (ex. 1/1-12/31)
• Officer Information (Full Name, Position, Start Date, Home Address, Phone Number, DOB, Driver's License # and State of Issue, SSN)

Can a copy of these slides be distributed, as a guide? 

Of course! Here is a copy of the presentation that Agile provided during the summit. It covers the basics of sales tax and how we tackle compliance for our customers.

Do you recommend using multiple accounts to better allocate funds and to keep track of expenses for tax purposes?

Depending on the size of your business's sales taxes and your filing frequency, it may be beneficial to use multiple accounts. However, most companies can manage this out of their primary accounts.

How do you set up sales tax while selling a product?

First, it’s best to know if you need to set up sales tax while selling a product. Not all businesses are required to collect sales tax – the rules vary by state. Recently, one of our team members posted a blog about this titled “Debunking Nexus Compliance” which summarizes knowing when to collect sales tax.  If you've confirmed that you are required to collect and remit sales tax, it's best to acquire a sales tax software that can track this for you.

If we are 501 C 3 classified and in Texas are we sales tax exempt?

Yes! Nonprofit organizations such as 501(c)(3), (4), (8), (10), or (19); are exempt from franchise and sales tax.

For multiple leagues, do you recommend separate income/outcome for each location or keep everything a one-stop shop?
For multiple leagues, it would be best to have separate income/outcome for each location - especially if the sales tax is significant. Each FEIN needs its own registration and each state the league is registered in needs to file a return. So, mirroring your accounts this way is beneficial.

Is there a registration fee tax or use tax and if only in some states which states?

While most states have free registration available, some will charge a fee that varies by state. In some states, if you have a DBA there is an additional fee assessed. For other states, your initial registration is free but additional registrations will populate a fee.  Some states will only assess a registration fee if the business is registering from out of state. Below is a list of registration fees associated with state sales tax registrations- please note that this is not a complete and comprehensive list and is subject to change

• AZ $12
• CT $100
• HI $20
• RI $10
• SC $50
• WA $90
• WV $30

What are the best ways to pay less tax?

The best way to pay less tax is to have a comprehensive understanding of tax law or hire someone that does. Many businesses are collecting sales tax on items that are not taxable or they are collecting at a rate that far exceeds what is required. Hiring a tax consultant to manage these or simply conduct an assessment to get you on the right track may be the best financial decision your business makes all year. Here at Agile, we have departments dedicated to both Compliance and Contingency.  That means that we can get you back on track with your taxes and pursue any refunds that you are due.

Unasked Questions, to which we still have answers!

Nexus Studies

These are the first steps towards compliance. Nexus is a connection between a business and the state. Once the nexus has been established (through the volume of sales, amount of sales or physical location) you will be required to collect and remit sales in each jurisdiction where it is met. Rather than only focusing on one state, it would be best to conduct a nexus study to review where in the U.S. the client is required to register and begin remitting sales tax. This will be beneficial to avoiding or managing the risk tolerance of audits, penalties and fees.

Taxability Studies

Taxability varies across states. In one state, your sales may be seen as taxable and in another, only a part of none of it may be taxable. In a taxability study, we review your data and product categories to create a presentation that helps you understand how your products and services are taxed across all locations where nexus is/is going to be established and offer recommendations on handling these tax obligations.

I got registered, now what?

File your returns regularly! Once you have confirmed that you are required to register and taken the plunge, you are on the hook to file returns based on your established filing frequency. The state or jurisdiction which you are registered in can require you to file monthly, quarterly, semi-annually or annually and this is subject to change at their discretion.  We do not advise registering in every state you think you should without a Nexus study as once you are registered you must KEEP filing. Deregistering is a bit of a hassle. Failure to file (even a $0 return) will result in penalties and fees. Know your business and your obligations before you begin registering!

Reach Out to Us with Questions

If you have questions, comments or would like to discuss the specific circumstances you are encountering in regard to this issue or any other sales and use tax issue, please contact a member of Agile Consulting Group’s sales tax consulting team at (888) 350-4TAX (4829) or via email at info@salesandusetax.com.