If you discover you should have been collecting sales tax but weren’t, you may face back tax liability plus penalties and interest. States have the authority to audit sellers and demand payment of uncollected sales tax directly from your pocket, which can be financially devastating for small businesses.

The consequences can be severe, but addressing the issue proactively is crucial. Contact a sales tax professional immediately to assess your exposure and explore options like Voluntary Disclosure Agreements that can reduce penalties and provide manageable payment plans.