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A property tax audit is an area audit that requires proactive monitoring and regular reviews. Business owners who run capital-intensive businesses need the assistance of an experienced audit partner who can guide them through the intricacies.
An audit partner who offers property tax consulting services will also help your business design effective tax management and tax reduction strategies. Taking the right steps at the right time will help you prevent the hassle of dealing with tax notices and warnings.
How Can a Property Tax Consultant Help?
Tax, in general, is a legislation-based field. For proper compliance, businesses will need to be aware of legal provisions, keep track of dates of filings, and precisely know what information to provide. Entrepreneurs find it difficult to go through these procedures on their own. If you are a business owner subject to property tax, you must seek help from the right firm offering consulting services.
Prevention of Errors
Tax returns can be too confusing to a layperson. Tax regulations are also complicated. For instance, a plot of land falls under the definition of “property” when it concerns most persons. However, for a real estate dealer, a house or plot of land would be considered “inventory” or “real estate”.
A tax professional who provides property tax consulting services to clients knows these classifications. You might end up filling in the wrong details in your return or delivering the wrong figures. These figures involve computations. Submitting incorrect information to authorities could also result in penalties. A property tax consultant will help you avoid these errors.
Complex Provisions, Tables, and Schedules
The Property Tax law goes through changes every year. Sometimes, the provisions are different for each jurisdiction. You will need to be aware of concepts like jurisdiction depreciation tables, form numbers, terminologies, etc. The authorities will also ask for calculations and tables. A property tax consultant can guide you to apply under the correct tables.
The consultant can also help you compute the right figures for different costs like original acquisition cost, improvements costs, and the like. Property tax deals in disclosing what the asset is used for, the asset’s life, the cost, and depreciation. Having the help of a property tax expert will help you supply the correct information and avoid additional costs.
Avoiding Fines and Penalties
To avoid penalties, you must ensure you supply the correct information. You must also ensure that you file returns within the stipulated deadline. Your property tax auditor is well aware of your business requirements. The tax expert is also well versed in property tax law and its provisions.
Working with a property tax consultant can save you the stress of figuring out computations and calculations by yourself. Your property tax consultant will help you file in the correct form within the given time.
Exemptions and Benefits
The law provides for exemptions and benefits that a taxpayer can avail. A property tax consultant is well aware of these exemptions. They vary from business to business and from jurisdiction to jurisdiction.
For instance, some jurisdictions may include “inventory” as part of “property” while others may exempt it. Various abatements may also be available for your capital investments for certain lengths of time. Not availing of these exemptions and reductions is a considerable loss for your business. Your tax consultant can help you identify the benefits available to your business.
A good tax expert does a procedure called “tax structuring,” where the expert suggests ways to carry out business transactions in the most tax-effective way possible. A property tax expert can thus help you generate significant tax savings.
Notices, Submissions, and Appeals
Tax authorities send orders and notices to business owners. Capital-intensive businesses are often subject to hearings and proceedings. If the tax authorities have served you notice or order, you’ll need the help of a property tax expert to help you draft a “submission” to present to the authorities.
Drafting submissions and appeals are not a layman’s job. You will require the services of a skilled property tax expert who knows the property tax law well. The tax expert finds loopholes in the Act to help you minimize fines and penalties. Your property tax consultant can also help you claim refunds with appeals and submissions.
A Third-Party Audit Can Generate Tax Savings and Avoid Unnecessary Penalties
By helping you avail all available exemptions and avoiding unnecessary penalties, a third-party auditor can help you create significant property tax savings for your company. The third-party auditor can also give you the necessary guidance to run your business in the most tax-effective way.