Mississippi Court of Appeals Finds Observational Sales Tax Assessment Presumptively Correct

The Mississippi Court of Appeals affirmed the Chancery Court’s order upholding a sales and use tax assessment against the taxpayers’ business, and an individual income tax assessment against the taxpayers. The Department of Revenue (DOR) audited the taxpayers and their business and calculated the amount of taxes owed based on an observational sales audit due to lack of adequate records. The Chancery Court noted the uncontroverted facts that the taxpayers did not maintain sufficient records for DOR to determine the correct amount of tax due, and in such cases an assessment may be based upon any information available and are ...