No matter how irrational or unlikely, many of us have a fear of IRS audits. For a corporate executive, that fear is magnified because of the potential consequences of an audit, which may include negative consumer reactions, a decrease in share price, and damage to the corporate brand.

Amazon.com likely realized some of those fears when it found itself in a sales tax dispute with the state of Texas. Earlier this week, Texas Comptroller Susan Combs announced that the company had reached a settlement deal with the state in that dispute. According to Combs, the online retail company has agreed to collect sales taxes on purchases from Texas beginning in July. Amazon has also promised 2,500 new jobs for the state and $200 million in capital investment over four years.

However, some question the deal as illegal. One commentator believes a state constitutional provision prohibits the "forgiving" of tax debts.

The comptroller's office denies "forgiving" taxes in violation of the Texas Constitution. According to Combs and her aides, factors influencing the state's decision to accept the deal included the risk of an adverse decision, future benefits to Texas and the upside of obtaining compliance with tax laws.

Corporate tax law is not only complex, but ever changing. Depending on the type of business and the service provided, unique taxes and rules may apply. If your corporation is facing an audit, you need the expertise of an attorney to guide you through the complex set of Texas state tax laws, rules and regulations unique to specific industries. An attorney can appear on your behalf in audits, redetermination of tax liability applications, refund requests and hearings before the State Office of Administrative Hearings brought by the Comptroller of Public Accounts.

Source: Lubbock Avalanche Journal, "Legality of Amazon-Texas sales tax deal questioned," May 14, 2012