Businesses can qualify for tax exemptions for many things, including energy and water usage in some situations. A predominant use study is required to qualify for these exemptions and must be repeated at regular intervals to maintain tax exempt status. Understanding the benefits of these studies will help you make the right decision to save money for your company.
Qualify for Tax Exempt Status
The primary reason to consider a predominant use study is to determine whether your energy and water use qualifies your company for tax-exempt status. During this study, the professionals will evaluate your current energy use and the percentage toward permitted processes. Not all water and energy use qualifies you for local, state, or federal tax exemptions. It’s their job to help you determine whether you can claim this tax exempt status.
Improve Your Energy Management
In addition to providing the tax-exempt status you need to reduce your operating costs, a predominant use study can help you improve your overall energy management. Understanding how your business uses energy is invaluable in helping you make better decisions to reduce your impact on the environment and your operating costs.
Documentation for Future Use
After a predominant use study, your company will receive the necessary documentation to prove your tax exemption status. While you don’t need this documentation for your current utility provider once you have proven you qualify, it can be useful for other purposes in the future. If you switch utility companies to reduce your costs, you need to provide your tax exemption certificate to get the discounts from your new provider. You will also need to show documentation if you move locations, expand your business, or change ownership.
Resource Box: If your business needs a predominant use study, visit the B. Riley Financial, Inc. website to schedule your appointment.
