There aren't many things that make me mad, but when it comes to running a company, few things are more frustrating to me than lazy employees. A few months ago I started keeping closer tabs on my workers, and it became immediately clear that there were some team members that didn't care at all about things like productivity, saving money, and doing the right thing. I wanted to do something to correct the situation, so I started honing our processes, holding more team meetings, and perfecting the processes. This blog is all about streamlining your company and making things right.
Currently about 30 states have regulations that benefit business owners by allowing them qualify for state and local utility tax exemption after conducting a predominant use study. Also known as a utility study, a predominant use study analyzes how much electric, gas and water your business uses. If you're considering hiring a licensed professional to conduct a predominant use study of your business, here's what you should know.
What It Is
To qualify for utility tax exemption, states require that the majority of the electric, or gas your company consumes be used for specific purposes. A predominant use study is conducted to prove that the utility is in predominant use within your business. The study analyzes the utility that your company uses to decide the type of sales tax exemption may you qualify for. A wide number of businesses can qualify, including food and beverage manufacturers, bakeries and assisted living facilities to name a few.
How it Works
The first step to qualify for sales tax exemptions and reductions is to hire a professional to conduct a predominant use study of your business. This legally proves to the government that your company complies with the requirements and should receive tax exempt status. You can expect the agent to investigate all of your utility usage such as the kilowatt per hour for electricity, the amount of water your business uses and the cubic foot of gas consumed.
Then, the agent will carefully check each of your utility meters on the premises and also analyze the energy consumption of your equipment. The amount of energy necessary for predominant use for you to qualify varies by state. However, if at least 50 percent of your energy consumption goes toward predominant use, your company generally qualifies to receive sales tax exempt status.
The cost savings is one of the major benefits of having a predominant use study conducted. If your business qualifies, you could save thousands of dollars each year. In some states you may even qualify to get a refund in the sales tax that you've paid over the two years prior to having the predominant use study conducted. Improvements in energy management is another benefit.
Once you have the study conducted, you'll be able to identify where your energy use is going and create a plan to better manage your energy consumption. For example, if you have machines that are powered on all day, you may implement times where the machines are not in use that you can power them down to save energy.
To learn more, contact companies like Utility Consultants Inc.Share