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Preparing bookkeeping records for a CDTFA sales tax audit
An audit request is easier to manage when sales, purchases and filed returns can be traced to their supporting records. Preserve the notice and agree on the document request and contact person before assembling the response.
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General information, not legal or tax advice.
Confirm the audit scope and representative
CDTFA says it rarely starts an audit without prior notice and usually makes initial contact by phone. The auditor identifies the period and records needed. Publication 76 says you may have an accountant or bookkeeper handle the audit by telling the auditor at initial contact.
Preserve records before exporting a working copy
CDTFA generally requires records for at least four years unless it authorizes earlier destruction in writing. Audit-period records remain needed until the audit and disputes are resolved. Preserve point-of-sale data that could be overwritten, and work from copies when organizing electronic exports.
Understand the proposed review method
Publication 76 describes actual-transaction and sample reviews and says the auditor should discuss sampling elements before finalizing the plan. Ask for clarification of the requested population and format. Keep a log of supplied files so later questions can be traced to the same version of the data.
Review findings and calendar the next step
CDTFA provides audit working papers and explains findings at the exit conference. A Notice of Determination requires payment or an appeal within 30 days of issue. Send that notice to your adviser promptly, retain the working papers and reconcile proposed adjustments before changing the books.
Keep the current filing workflow visible during review
The verified calendar places the Q3 2026 California quarterly sales tax return deadline on November 2, 2026. As an audit-management practice, assign ongoing filing preparation separately from historical document requests. Keep the period on each working file and confirmation so current transactions do not become mixed into an older audit sample.
Sources: confirm the audit scope and representative
Organize records for an audit review
Tidwell helps reconcile sales and purchase records and supports sales tax filing within an agreed scope. Bring your account instructions and the questions you need to review with your CPA.