--- title: "State & Local Tax" url: "https://www.lbmc.com/services/tax/state-local-tax/" description: "Manage complex state tax obligations with LBMC’s state and local tax services. Get advisory support for nexus, audits, compliance, planning, and more." site: "LBMC" type: "Page" published: "2025-12-23" updated: "2026-09-25" --- [Home](https://www.lbmc.com/) » [Services & Solutions](https://www.lbmc.com/services/) » [Tax](https://www.lbmc.com/services/tax/) » State & Local Tax # State and Local Tax Services State and Local Tax (SALT) compliance has become increasingly complex as businesses expand across state lines, hire remote employees, acquire new entities, or sell products and services in multiple jurisdictions. Different states apply different rules for income tax, sales and use tax, franchise tax, gross receipts tax, and nexus, making it difficult for organizations to stay compliant while minimizing tax exposure. LBMC’s State and Local Tax (SALT) professionals work alongside our [Federal Business Tax](https://www.lbmc.com/services/tax/federal-business-tax/) specialists to help businesses evaluate multi-state tax obligations, manage compliance, respond to audits, and identify planning opportunities that support informed business decisions. From business expansion to audit defense and ongoing compliance, our team provides practical guidance tailored to your organization’s unique circumstances. ## Common State Tax Challenges State and local tax issues often emerge as businesses grow, expand, or change how they operate. Different states apply different tax rules, creating new filing obligations, compliance requirements, and planning opportunities that can be difficult to identify without specialized guidance. Organizations often involve LBMC’s State and Local Tax professionals when complexity increases or risk becomes more difficult to manage internally. Common situations include: - **Expanding into new states** and understanding new tax filing obligations. - **Hiring remote employees** or opening new offices, warehouses, or distribution facilities that may create nexus. - **Selling products or services in additional states** and evaluating sales and use tax requirements. - **Responding to state tax audits, notices, or inquiries** from taxing authorities. - **Acquiring, merging, or restructuring a business** and evaluating the state tax implications of the transaction. - **Reviewing historical tax exposure** or identifying opportunities for refunds, voluntary disclosure agreements (VDAs), or process improvements. ### Explore State & Local Tax Resources Access LBMC’s monthly State & Local Tax newsletters and practical resources for timely insights on nexus, sales and use tax, state income and franchise tax, credits and incentives, multistate tax planning, and legislative changes impacting your business. [View SALT Resources](https://www.lbmc.com/services/tax/state-local-tax/resources/) ![SALT Newsletter](https://www.lbmc.com/wp-content/uploads/2026/07/SALT-News.png) ### Stay Current on State Tax Changes Managing state tax obligations is ongoing. Regulations shift, enforcement increases, and new risks emerge as your business grows. **Subscribe to our SALT Insights** for practical insights on nexus, audits, and state tax strategy — delivered straight to your inbox. ## State and Local Tax Services We Provide LBMC’s State and Local Tax consulting services are designed to help businesses proactively manage multi-state tax obligations while responding effectively to changing regulations, audits, and business growth. Our team provides practical guidance that helps organizations identify risk, improve compliance, and make informed decisions at every stage. Our State and Local Tax team regularly advises businesses on **nexus studies, sales and use tax consulting, state income tax planning, franchise tax compliance, voluntary disclosure agreements (VDAs), audit defense, and multi-state tax strategy.** ![State and Local Tax Services](https://www.lbmc.com/wp-content/uploads/2026/07/iStock-2181751797-SALT.jpg) ### Diagnostic Services #### Identify risk, exposure, and planning opportunities. Understanding your current SALT position is the foundation of an effective multi-state tax strategy. LBMC helps businesses evaluate **nexus**, **state income tax**, **sales and use tax**, **franchise tax**, taxability, and historical tax exposure to identify compliance obligations and planning opportunities before they become costly issues. **This typically includes:** - **Nexus studies** to determine where you have filing obligations - **Taxability reviews** across products, services, and jurisdictions - **Exposure assessments** to quantify potential liabilities - Identification of overpayments or **refund opportunities** - **Compliance review** of current processes and gaps A nexus review can reveal obligations that aren’t obvious from where a business has offices. Our guide to [what nexus means when doing business in different states](https://www.lbmc.com/blog/what-is-nexus-and-why-you-should-care/) explains common triggers. This gives you a clear understanding of your risk profile and where to take action first. Our team also collaborates with LBMC’s [International Tax](https://www.lbmc.com/services/tax/international-tax/) professionals when cross-border business activities create additional state tax considerations. ### Preventative Services #### Build a stronger long-term state tax strategy. As businesses expand into new states, hire remote employees, acquire other companies, or sell products across multiple jurisdictions, state tax obligations continue to evolve. For software and SaaS companies, [state tax obligations](https://www.lbmc.com/blog/tax-liabilities-for-software-and-saas-companies/) may depend on where customers are located, what the company sells, and where its people work. LBMC helps organizations develop proactive **state and local tax compliance** strategies, monitor changing **nexus** requirements, improve **sales and use tax** processes, and align tax planning with long-term business growth. **We help you:** - Establish consistent multi-state filing practices - Improve documentation to support tax positions - Align tax strategy with operations and expansion plans - Monitor nexus changes as your footprint evolves - Reduce audit risk through proactive planning Taxability can also depend on what a company sells. See how those questions arise for [technology companies managing sales tax](https://www.lbmc.com/blog/sales-tax-in-technology-industry/) and for businesses selling [cloud-based software in Tennessee](https://www.lbmc.com/blog/do-you-owe-tn-sales-tax-on-cloud-based-software/). Industry-specific incentives can also affect the cost of a new project. For example, qualifying productions may want to assess [Tennessee film tax incentives and production grants](https://www.lbmc.com/blog/tax-benefits-film-tv-production-tennessee/) before significant spending begins. The goal is to create a sustainable approach that keeps your business compliant without adding unnecessary complexity. ### Emergency Services #### Respond with confidence when issues arise. State tax audits, notices, nexus disputes, and sales tax assessments require immediate attention. LBMC helps businesses respond to **state income tax audits**, **sales and use tax audits**, **voluntary disclosure agreements (VDAs)**, state notices, and other tax controversies while working to minimize disruption and potential liabilities. **Support may include:** - Audit defense and response management - Assistance with state notices and inquiries - Negotiation and resolution of tax disputes - Voluntary disclosure agreements (VDAs) - Remediation of prior compliance gaps When an issue surfaces after a transaction, timing matters. LBMC’s look at [tax liabilities a buyer may inherit in an asset purchase](https://www.lbmc.com/blog/tax-liabilities-buyers-asset-purchase/) shows why state tax exposure belongs in the review before a deal closes. Our focus is to protect your position, minimize potential liabilities, and resolve issues as efficiently as possible. ### Tax Solutions Built Around Your Goals Whether you’re navigating multi-state complexity, preparing for an audit, or planning your next phase of growth, LBMC’s state and local tax advisors can help you clarify exposure, identify opportunities, and move forward with confidence. Start with a conversation grounded in your business reality. Talk to an Expert ## Why Choose LBMC as Your State and Local Tax Firm? - **Dedicated State & Local Tax specialists** with experience helping businesses manage complex multi-state tax issues across a wide range of industries. - **Practical, business-focused guidance** that balances technical tax expertise with recommendations aligned to your organization’s operational and financial goals. - **Integrated access to LBMC’s tax and advisory professionals**, including Federal Business Tax, International Tax, Transaction Advisory, and Credits & Incentives specialists when additional expertise is needed. - **Proactive planning and ongoing support** that helps businesses identify opportunities, reduce risk, and respond confidently to changing state tax laws. - **A trusted, long-term advisor** committed to helping organizations navigate state tax complexity as they grow, expand, and evolve. ## Industries We Support Different industries face different state tax challenges. LBMC’s State and Local Tax professionals provide industry-informed guidance that reflects the unique tax considerations affecting each organization’s operations, transactions, and growth objectives. #### Explore our industry expertise: - [Healthcare](https://www.lbmc.com/industries/healthcare/) – Healthcare organizations may also need to review [sales tax treatment for medical products and equipment](https://www.lbmc.com/blog/unlocking-the-complexity-of-sales-tax-in-healthcare/), where exemptions depend on the product and the applicable state rules. - [Manufacturing and Distribution](https://www.lbmc.com/industries/manufacturing-distribution/) - [Private Equity](https://www.lbmc.com/industries/private-equity/) - [Real Estate and Construction](https://www.lbmc.com/industries/real-estate-construction/) - [Technology and SaaS](https://www.lbmc.com/industries/technology/) [Explore More Industries](https://www.lbmc.com/industries/) ### Local Expertise, Wherever You Are With offices in [Chattanooga](https://www.lbmc.com/locations/chattanooga/), [Memphis](https://www.lbmc.com/locations/memphis/), [Louisville](https://www.lbmc.com/locations/louisville/), [Nashville](https://www.lbmc.com/locations/nashville/), [Knoxville](https://www.lbmc.com/locations/knoxville/), [Philadelphia](https://www.lbmc.com/locations/philadelphia/), and [Charlotte](https://www.lbmc.com/locations/charlotte/), plus remote offices, LBMC partners with businesses across the region and beyond. [Find an office near you.](https://www.lbmc.com/locations/) ## FAQs about State and Local Tax Services **What is nexus, and why does it matter?** Nexus is a connection between a business and a state that may create tax obligations there. An office, employee, or inventory in a state can establish that connection, but physical presence isn’t always required. Sales activity may also cross a state’s economic nexus threshold. The [*Wayfair* ruling](https://www.lbmc.com/blog/wayfair-case-sales-tax/) explains why a business may have sales tax obligations without a physical presence in a state. Because the rules and thresholds vary, a business entering a new market should review where it may need to register, collect sales tax, or file returns. LBMC explains these triggers in [what nexus means for businesses operating in different states](https://www.lbmc.com/blog/what-is-nexus-and-why-you-should-care/). **When should a business involve a State and Local Tax advisor?** The best time is before a decision changes where or how the business operates. That could mean hiring a remote employee, opening a facility, selling into a new state, or acquiring another company. An advisor can assess potential filing obligations and tax exposure while there is still time to plan. State tax review is particularly useful during a transaction because [certain tax liabilities can follow the buyer in an asset purchase](https://www.lbmc.com/blog/tax-successor-liability-for-asset-acquisitions/). **Can LBMC help with state tax audits?** Yes. LBMC helps businesses respond to state tax audits, notices, and questions from taxing authorities. We work with clients to understand what the state is reviewing, gather supporting records, assess the tax position, and respond to requests. If an audit identifies a broader issue, our SALT team can also help determine whether the business needs to change its filing or sales tax processes going forward. **What types of state taxes does LBMC help businesses manage?** LBMC advises on state income and franchise taxes, sales and use tax, gross receipts and business taxes, property tax, and other state-specific obligations. The questions depend on both where a company operates and what it sells. For example, the treatment of [cloud-based software under Tennessee sales tax](https://www.lbmc.com/blog/do-you-owe-tn-sales-tax-on-cloud-based-software/) calls for a different analysis than a company’s income tax filing requirements. **How can businesses identify potential state tax refund opportunities?** Start by reviewing what the business paid, how it classified its transactions, and whether a law change or court decision affects prior filings. A [reverse sales tax audit](https://www.lbmc.com/blog/reverse-audit-save-company-thousands/) may identify tax paid on purchases that should have been exempt. Other opportunities can be more specific: a recent [Tennessee decision involving SaaS license revenue](https://www.lbmc.com/blog/tennessee-saas-business-tax-ruling/) prompted businesses to examine whether they may have overpaid Business Tax. Refund eligibility and filing deadlines depend on the facts and the state involved. **How do changing state tax laws affect my business?** A change in legislation, a court ruling, or new agency guidance can affect what a business must collect, pay, or report. It may also change an available planning opportunity. Tennessee’s [franchise tax changes](https://www.lbmc.com/blog/tn-enacts-major-franchise-tax-changes/) are one example of why businesses should revisit prior assumptions rather than relying on last year’s approach. LBMC helps clients assess which changes apply to their operations and whether a response is needed. **What should a business consider before expanding into Kentucky?** Kentucky’s state tax rules are only part of the picture. Depending on where and how your business operates, you may also need to account for the Limited Liability Entity Tax, sales tax, and separate city or county filing requirements. LBMC’s overview of [Kentucky’s tax environment](https://www.lbmc.com/blog/kentucky-tax-law/) explains the issues worth reviewing before you expand. Our [Louisville tax team](https://www.lbmc.com/services/tax/louisville/) can help assess how those requirements apply to your plans. ## LBMC's Team of Tax CPAs and Advisors ## LBMC State and Local Tax [![Jay Hancock is a Shareholder at LBMC in Nashville, leading the State and Local Tax practice with 25 years of SALT experience.](https://www.lbmc.com/wp-content/uploads/2025/07/Jay-Hancock-Web-Headshots-150x150.jpg)](https://www.lbmc.com/team/jay-hancock/) ## [Jay Hancock](https://www.lbmc.com/team/jay-hancock/) #### Shareholder, Practice Leader State and Local Tax [jay.hancock@lbmc.com](mailto:jay.hancock@lbmc.com) [![Leigh Ann Vernich](https://www.lbmc.com/wp-content/uploads/2025/07/vernich-leighann-150x150.jpg)](https://www.lbmc.com/team/leigh-ann-vernich/) ## [Leigh Ann Vernich](https://www.lbmc.com/team/leigh-ann-vernich/) #### Senior Manager, Tax [leighann.vernich@lbmc.com](mailto:leighann.vernich@lbmc.com) ## Talk to an Advisor Whether you’re navigating multi-state complexity, preparing for an audit, or planning your next phase of growth, LBMC’s state and local tax advisors can help you clarify exposure, identify opportunities, and move forward with confidence.