A Cigarette Tax audit is a review of your business records and tax filings to check if you are correctly reporting this tax. A Minnesota Department of Revenue auditor will:.
- Review your records for a specific time period.
- Explain any errors you've made on your returns and how to correct them.
- Make recommendations to help you eliminate similar errors in the future.
- Provide an audit report summarizing any changes to your tax liability.
- Be available in the future to help with your return or answer any questions or concerns you have.
What do we look at during the audit?
We will review your records to check the accuracy of each line item on your Cigarette Tax return. Among the records we may request are:
- Monthly returns and reconciliations
- Cigarette purchase invoices from manufacturers
- Inventory records, such as physical, perpetual and book inventories (including copies of all manual count sheets, computer printouts, etc.)
- Credit memos and manufacturing affidavits for Minnesota-stamped cigarettes that you returned to manufacturers
- Check registers, bank statements, credit card statements and other records that detail cigarette purchases
- Copies of cigarette returns you filed in other states
- Out-of-state sales invoices and shipping documentation
What happens after the audit?
After the audit we'll send you a final audit report outlining the results. This report will include details on any additional tax, penalty, and interest you may owe, or if you are entitled to a refund.
You'll have 60 days from the date of the report to respond in one of the following ways:
- Pay what you owe without additional late penalties or interest being added.
- File a written informal appeal with the department's Appeals Unit.
- File a formal appeal with the Minnesota Tax Court.
If you have questions or need more information, please contact the auditor who worked with you.
For more information about the audit process and your rights during an audit:
Minnesota Taxpayer Rights