You received your Texas Notification of Audit Results, what are your options?

The Texas Notification of Audit Results is the determination of the results from your audit. The notification balance shows results from the audit and does not include any opened balances from report periods.

When you receive your Notification of Audit Results it is important to note that a deficiency determination becomes final 60 days after the statement date on the notification. Full payment is due 10 days after the day it becomes final. If payment is not made in that time, there will be a 10% penalty on the amount. Interest will continue to accrue on the tax/fee until paid.

Sometimes the state might determine that their interest is in jeopardy such as in a fraud case. In this case the determination becomes final 20 days after, and payment is due 10 days after the day it becomes final. There is a 10% penalty if your payment is not made at that time along with interest accruing. If you agree with this assessment, you will send a check or money order payable to the comptroller for the total liability plus additional interest that might have accrued in that time.

If you do not agree with the audit results you can request a redetermination hearing or a refund.

Redetermination Hearing: You must send a letter with a statement of grounds for a redetermination hearing on or before the final due date. Your Statement of Grounds must list the items that you disagree with and state the factual basis and legal grounds to support your claims by citing legal authority for your position. The Comptroller will send you an acknowledgement of the letter and the auditor will review additional documentation. If you agree with the changes made you will sign a Taxpayers Withdrawal of Request of a Hearing and Consent to Contested Case Dismissal form and will receive an Amended Notification of Audit Results, if you still disagree you will be assigned to an attorney in the Hearings and Tax Litigation Division who will review your case and issue a Position Letter.

If you are within 6 months after the final date and have paid the entire liability including penalty and interest, you can request a refund hearing. This will include a request for refunds of all tax actually assessed and paid in the audit plus any additional refunds in the four-year period of statute of limitations.

If more than 6 months have passed and you have paid the entire liability, including penalties and interest, you can request a refund for any report period that is still within the four-year statute of limitations.

You will receive results of a refund request through a letter. This letter will let you know about your rights to file for an administrative refund hearing or the right to waive this right and file suit on the refund claim in a district court. A refund that has been denied by the comptroller cannot be requested again later, even if the period is within the statute of limitations.

What happens if you don’t pay your assessed taxes?

When you don’t pay your dues, the comptroller has legal authority to take various actions to collect taxes that are passed due such as:

• require a security bond to be posted;
• file a tax lien in applicable counties;
• freeze and seize non-exempt assets;
• suspend permits;
• file criminal charges;
• place a hold on any state warrants payable to the taxpayer.

Informative links: Tax Refund Information, Notice of Routine Audit, Audit Process