Utility Exemption Studies

For many taxpayers, sales tax exemptions on the procurement and particular use of utilities, such as electricity, natural gas, steam and water, can provide a meaningful source of tax savings. To recover and reduce your utility costs through the reduction or elimination of sales tax, a predominant use study or utility exemption study is typically required to support the claim for relief.

As part of our typical engagement, TaxMatrix will coordinate and cover the cost of any necessary utility studies. Utility study detail and certification documentation requirements vary by state, but in most cases, the power consumed to operate exempt equipment is considered an exempt use of that power. In some states, meters that indicate > 50.01% of their power consumed operating exempt equipment qualify for a 100% exemption from sales tax.

Our intimate knowledge of all state and local tax laws and compliance requirements will ensure that we submit an accurate utility exemption claim that substantiates the highest possible exemption percentage achievable on behalf of your company.

If you have not had this opportunity area reviewed, we can help! Contact TaxMatrix to inquire about utility exemption studies.


Identify Significant Tax Savings with A Predominate Use Study

A utility exemption study will help identify opportunities for tax savings and isolate areas of exposure, including:

  • Changes in business activity (up or down)
  • Re-metering within plants
  • Expansion/relocation of facilities
  • Changes in utility vendors due to deregulation
  • Acquisitions
  • Outsourced utility bill management
  • Erroneous vendor accounting systems

Our team looks forward to partnering with you to support your company’s compliance and recovery objectives. If you are interested in learning more about the impact a utility exemption study could have on your sales and use tax, please contact us today.