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ACTION NEEDED by February 20, 2020 for Potential Over Collection of Tax in Wisconsion Premier Resort Areas

Overview

Avalara recently determined that between January 1, 2020 and January 21, 2020, transactions in the Wisconsin Premier Resort areas may have produced unexpected sales tax results. These transactions may show an unexpected Wisconsin city or local special tax jurisdiction sales tax rate instead of only showing the expected state and/or county jurisdiction rates.

These Wisconsin premier resort areas may show unexpected total sales tax rates of 6% instead of 5.5%:

  • Bayfield
  • Eagle River 
  • Rhinelander 
  • Sister Bay 
  • Stockholm 

These Wisconsin premier resort areas may show unexpected total sales tax rates of 6.75% instead of 5.5%:

  • Lake Delton 
  • Wisconsin Dells 
     

Environment

AvaTax

Resolution

Please take these mitigation steps:

If you intend or intended to collect the Wisconsin premier resort tax 

Confirm that you are registered with the Wisconsin Department of Revenue to collect and remit this tax.

Update your Avatax company nexus settings to select all seven Wisconsin premier resort area jurisdictions.

If you didn't intend to collect the Wisconsin premier resort tax

  • Identify affected transactions

Review your sales transactions in Wisconsin from January 1, 2020 through January 21, 2020 to see which transactions calculated with an unexpected premier resort area jurisdiction rate.

To find affected transactions, review transactional data on the Transactions tab in AvaTax, or run a Tax Return - Sales and Sellers Use Tax Report.

  • Recalculate sales tax on the affected transactions

Because the Wisconsin state tax filing period is open, it is generally best practice to complete this review and make any necessary changes on or before February 20, 2020 by doing the following:

  • Recalculate sales tax, import transactions, or recalculate from your accounting system. If you are an Avalara Returns customer, be sure your recalculation is complete in time for your next filing (2/10/20 for monthly filers).
  • Refund your customer the Wisconsin premier resort jurisdiction’s tax rate of 0.5% or 1.25%, depending on the jurisdiction.  

You should contact your tax professional for guidance on how to report the overcharged tax. 

For information on Wisconsin Premier Resort taxes, see How can I determine when a premier resort tax is imposed in a Wisconsin municipality?