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Missouri Law Expanding Sales and Use Tax Refunds Goes Into Effect

10.01.2019

Missouri Senate Bill 87 (SB 87), that modified several tax provisions and provides an expanded refund opportunity related to sales and use tax for businesses, went into effect on August 28, 2019. If you believe you overpaid Missouri sales or use tax, you may file a claim for a refund within 10 years of the due date of original return or the date of overpayment, whichever is later. Prior to August 28, a refund claim had to be made within three years.

Strategically, this is a good time to evaluate your sales and use tax filings and apply for refunds. The obvious benefit is that you can seek a refund for an additional seven years, which could potentially double the refund claim. However, there is an additional benefit related to the discrepancy between the statute of limitations for assessments and the statute of limitations for refunds. The Missouri Department of Revenue cannot issue a notice of assessment for sales or use tax more than three years after the date you filed the return or the due date of such return, whichever is later, assuming there was no fraud. As a result, the Department will not be able to assess additional sales/use tax the first seven years of a 10-year refund claim.    

For more background on the legislation, please see this previous article.

For more information on how our team can assist your business with state and local tax planning, please reach out to Pam Huelsman, Principal and State and Local Tax (SALT) practice leader, at phuelsman@bswllc.com; Bernie Ottenlips, SALT Principal, at bottenlips@bswllc.com; or Amy Jackson, SALT Principal, at ajackson@bswllc.com.

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