Voluntary Disclosure Agreements (VDAs)
Unreported sales tax, missed filings, or unregistered business activity can feel like problems best left buried — but the longer you wait, the greater the risk. State tax authorities are proactive, and once they contact you, penalties and interest can escalate quickly. A Voluntary Disclosure Agreement (VDA) is your chance to step forward before the state comes knocking. Our CPA team in New York helps you discreetly resolve past exposure, negotiate favorable terms, and restore compliance across multiple jurisdictions. With the right guidance, you can protect your reputation, avoid severe penalties, and move forward with a clean slate.
Why Voluntary Disclosure Agreements Matter
Many businesses underestimate the risk of unfiled or underreported taxes. With the rise of interstate sales, e-commerce, and complex nexus rules, it’s easier than ever to trigger tax obligations across multiple states without realizing it. Left unaddressed, these issues can turn into aggressive audits, unexpected assessments, and reputational damage that lingers for years.
A VDA changes the dynamic. Instead of waiting for state authorities to initiate contact, you proactively disclose past issues under structured terms. This usually results in reduced penalties, limited look-back periods, and — most importantly — a chance to control the narrative. Our role is to guide you through the process confidentially, negotiate terms that work in your favor, and ensure your systems remain compliant moving forward.
What’s Included
Confidential preparation and filing of Voluntary Disclosure Agreements
Negotiated penalty reductions and limited look-back periods
Direct representation with state tax authorities — we handle the discussions
Coordinated multi-state VDAs where obligations overlap
Ongoing compliance strategies to prevent future issues
We Help With
Unfiled or underreported sales and use tax obligations
Nexus-triggered exposures from operating in multiple states
Years of unregistered activity that create ongoing risk
Fear of reputational damage from state disclosure
Lack of clarity around multi-jurisdictional compliance rules
Explore More Audit Support Services
IRS audit issues often overlap with other tax challenges. That’s why our Audit Support category includes a full range of services:
- Back Taxes Help — file missing returns, reduce penalties, and stop collections
- IRS Audit Representation — defend your business during federal or state audits
- Managed Audit Programs — cooperate with state programs while protecting your interests
- Reverse Audit (Refund Recovery) — recover overpaid sales and use taxes
FAQs: Voluntary Disclosure Agreements (VDAs)
A CPA helps you avoid overpaying taxes and build a strategy that supports your financial goals. Here’s what you need to know about tax filing, planning, and audit representation —whether you’re in New York or anywhere in the US.
Is the voluntary disclosure process confidential?
Yes. One of the key benefits of a VDA is confidentiality. When you initiate the process through an experienced CPA, your identity remains anonymous until the state agrees to the terms of the disclosure. This means you can explore options and negotiate conditions without exposing your business upfront. Only once the agreement is accepted does your identity become part of the process. This discretion is especially important for businesses concerned about reputational impact or sensitive client relationships.
What if I owe taxes in multiple states?
Multi-state exposure is increasingly common, particularly with e-commerce and service-based businesses. Nexus rules can trigger obligations in states where you didn’t expect them. Our CPA team coordinates VDAs across multiple jurisdictions, ensuring consistency in your approach and preventing states from working against one another. By handling the process strategically, we often secure reduced look-back periods and penalty abatements across the board.
How far back will states require me to file?
One of the biggest advantages of a VDA is the limited look-back period. While a standard audit could expose you to liabilities going back many years, a VDA typically requires disclosure for only 3–4 years, depending on the state. This can significantly reduce the amount owed and prevent older issues from being reopened. Without a VDA, you may be liable for taxes stretching far beyond this period.
Can penalties really be reduced or eliminated?
Yes. States offer VDAs specifically to encourage voluntary compliance, and as an incentive, they often waive or reduce penalties. The key is demonstrating that your disclosure is proactive and in good faith, rather than a response to an audit notice. Our CPA team ensures your disclosure is positioned properly, increasing the likelihood of penalty relief while negotiating the most favorable terms.
What happens after the VDA is complete?
Completing a VDA is only part of the process — staying compliant afterward is just as important. We don’t just finalize the disclosure and walk away; we help you implement systems to ensure ongoing compliance. This includes reviewing your sales and use tax processes, updating reporting procedures, and monitoring nexus triggers in other jurisdictions. By building strong compliance practices, you prevent future issues and maintain the credibility gained through the disclosure.
