Consumer Chemical Manufacturer Nets $225,000 Reduction in Property Taxes
Client: Global Provider of Household Chemical Products
Challenge: Reduce Property Tax Assessment; Rectify and Reclassify Asset Records
A fully integrated manufacturer of well-known household chemical products asked AccuVal to help reduce its annual property tax assessment. AccuVal immediately focused on the historical manner in which personal property had been reported for taxation while also pursuing additional tax savings by maximizing exemptions for certified pollution control assets.
AccuVal Approach
To further complicate the engagement, the personal property tax return filing date for the current tax year was just three months away – and the state's return requirements were highly complex. In order to reconcile the company records, AccuVal launched a thorough review of all fixed assets. The firm worked with engineers and managers to conduct detailed site inspections and document the existence of ghost assets – assets that either no longer existed or whose useful life had expired – as well as assets that had been recently added but had no value. All pollution control assets that could qualify for exemption were also identified. AccuVal completed the entire fixed asset review within two months of the project start date, including providing the client with detailed fixed asset schedules. Had the deadline been missed, the client would have forgone another year of tax savings, totaling approximately $225,000. Because this significant reduction in the tax base would have an impact on the local school district's future revenues, AccuVal provided the company with a thorough report identifying the basis for the tax savings. It carefully detailed the company's overpayment of its personal property taxes for at least five years.
Bottom Line: $225,000 Annual Savings in Property Taxes; Fixed Asset Systems Cleansed and Accurate; Pollution Control Exemptions Maximized
By accurately documenting the company's fixed asset system and appropriately categorizing the personal property subject to taxation, AccuVal helped the company realize an immediate savings of $225,000 and identified capital assets with significant value that would be exempt from taxation in future tax years.
The AccuVal AdVantage™
Intimate knowledge of pollution control assets and corresponding tax law. A bottom-up approach to asset verification and valuation. Decades of personal property consulting and appraisal experience. That's The AccuVal AdVantage™ at work.
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