This is how gross receipts per GRT tax return are calculated in example: Total sales from bank statements divided by 1+gross receipts tax rate (assume it's 8%) should equal total gross receipts on gross receipts tax report ($50,000/1.08).
Important: If the sales reported on your federal income tax return exceed gross receipts by more than the amount of the tax, you could be audited by the Taxation & Revenue Dept.
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Does it matter whether I use bank deposits or gross receipts as sales on my federal tax return?
Bank deposits and gross receipts are taken from the same the same basic information - assuming you deposit all money receive from sales.
Whichever one you choose to report to the IRS, the main thing to be concerned with is that the N.M. Taxation & Revenue Dept. compares sales reported to the IRS with total reported gross receipts (not to be confused with taxable gross receipts). Note: If bank deposits are reported to the IRS, that amount will be greater than total gross receipts because deposits include gross receipts tax. The Taxation & Revenue Dept. takes this discrepancy into account when they determine whether the it indicates that the business has not reported all of their gross receipts.
