Tackling Contractor Taxes
Sales and Income Tax Advisory Network has the answers contractors need to stay compliant with complex sales and use tax laws
With a passion for training, sales tax and serving contractors, Holly Hoffman, the sole owner of Wisconsin-based Sales and Income Tax Advisory Network LLC, had a vision for educating and supporting industry professionals on the ins and outs of local tax and use laws.
Prior to founding the company in partnership with an accounting firm (which she has since bought out), Holly worked for Wisconsin Department of Revenue (DOR), initially as an auditor and eventually leading the Speakers Bureau, which provides speakers to business, community and educational organizations. She says, “My expertise was contractor sales and use tax. I implemented all the law changes for contractors for the State of Wisconsin. While running the Speakers Bureau, I did a lot of training internally at DOR on contractor tax law and then externally.”
Holly says it was actually the limitations of her DOR job that ultimately inspired her to start the company, explaining, “When you work for the state, you can’t advise in your position. You can’t tell people what to do. You can only tell them what the law is, and I saw a real disconnect. There weren’t a lot of resources out there for businesses— especially the medium or smaller contractors, suppliers, manufacturers and fabricators who might think: ‘I get what the tax law is, but what am I supposed to do?’ ”
Holly sees the role of Sales and Income Tax Advisory Network as a bridge to that knowledge.
“What I provide is compliance,” she says. “I help people comply with the law. Everything I do revolves around educating the business owner, but not in a legalistic, difficult to understand way. I help them implement it in their actual business with how they do things. I don’t know anyone else right now in Wisconsin who can do that.”
Although most people think there’s some cookie-cutter answer or that they have to go out and buy a big, expensive tax system, the reality is not so extreme. Holly shares, “I can go into any company and help them streamline their procedures, figure out how the tax law really applies. One of my mechanical contractors didn’t really understand how sales tax applied in their business, and they were missing use tax and having some serious compliance risk issues. So, I helped them fix the system that they currently use so they didn’t have to change. At the end of the year, they told me, ‘It’s amazing. You just came in, made your changes, and now everything flows and works.’ They can now generate reports that go directly on their return. It’s effortless.”
Holly can customize services for each customer, adapting their system so that they don’t have to think about sales and use tax. She also educates them on the importance of compliance so that they neither overcompensate and pay too much or underreport, leaving them at risk for audit. “Contracting is a big dollar business,” says Holly. “It doesn’t necessarily mean they have huge profits. Sales tax isn’t about income, it’s about purchases and sales. I don’t think people realize how huge of an impact that can be when you’re making errors one way or the other.”
She adds, “Either they have a huge risk looming or they’re throwing away their money. And if you don’t get audited for that period, you don’t have a way to get that back. For some of those contractors, it’s thousands and thousands of dollars.”
Service and Support for Every Need
Depending on the customer’s wants and needs, Holly offers different levels of service, everything from setting up a system and then consulting to a full audit protection plan with a monthly fee and unlimited and ongoing access to Holly for sales tax advice. With that plan, if a company is audited, Holly provides the audit defense at no additional charge, so it’s like insurance.
While Holly is a one-person force, she does have a strong support network of contacts that she’s made throughout the years. Her primary advisor is Jack De Young, CPA, who worked in the same area she did in administration at the DOR.
Coming Soon: Contractors Sales and Use Tax Event
Although home base is Wisconsin, Sales and Income Tax Advisory Network also provides its services to out-of-state and multistate companies. With education a main focus, an annual contractor training session is a particular pride point for Holly. In February of 2022, the company will host a two-day Midwest Contractor Sales Tax Conference. Holly shares, “I’m going to bring in not only Wisconsin Department of Revenue, but we will have experts from Minnesota, Iowa, Illinois and Michigan come in and speak. Several associations are on board, including Wisconsin Builders Association and the Business Credit Management Association. There is no other event like it.”
Holly concludes, “My whole goal is to empower contractors through education, training and resources to really understand sales and use tax so that their businesses are successful. We’re helping them take control of their business and minimize risk so they’re not throwing lots of money away.”