Manufacturers may eligible for a tax exemption on the utilities that are consumed in direct relation to the creation of their products. In order to determine utility tax service, a predominant use study will need to be conducted. Specialists who are experts in the identification of production items that are tax-exempt, even in the most complex facilities.
You May Save Thousands
For many manufacturing businesses, the sales tax that they pay on utilities can add up rapidly over the years. Utility tax service can result in thousands of dollars of savings. To reduce your company’s utility expenses, a comprehensive study must be done in order for these exemptions to be claimed.
How Does Utility Tax Service Work?
A predominant use study utilizes the meters on the manufacturing lines and takes little to no time to perform. Once the study is complete, you may submit a certificate for tax exemption to your utility provider. The exemption will be applied to your bill based on your utility usage.
Essentially, the determined predominant usage must make up more than 50% of consumption on any meter. The utilities must be used directly for production activities.
Determining factors for direct use include:
- Physical proximity to the production process
- Time of use
- How the utility is used for product production
What Does a Predominant Use Consultant Do?
A predominant use consultant will gather all of the required documentation, such as utility statements from suppliers. You could receive as much as a 90% exemption with utility tax service.
If you are interested in learning more about Utility Tax Service, we are here to help at B. Riley Financial, Inc. For more details, visit us now.
