As a customer advocate, we minimize tax obligations and maximize restitution, through “Predominant Use Studies”. A “Predominant Use Study” is based on the Texas Comptroller’s Office tax codes (TAC Title 34, Part 1, Chapter 3, Subchapter O, Rule 3.295), which requires such a filing to qualify a facility for state and local sales tax exemption on electricity and natural gas billings.
A certified engineering study, provided by an independent engineering firm, will determine the electricity and gas consumed vs. total usage in the facility. Each electric and/or gas meter at the facility must be studied independently to determine its eligibility for tax exemption. If it can be shown that more than 50% of electricity and/or gas passing through a particular utility meter are used directly for tax exempt purposes, then the entire usage through that meter is tax exempt. Texas sales and use tax rates up to 8.25% of electricity and/or natural gas billings can be reduced significantly by eliminating this tax at eligible facilities.
Benefits to You
- Expenses – No out of pocket costs.
- Cost Savings – If your facility qualifies, you will no longer be required to pay sales tax on electricity and/or gas. In addition, your business may qualify for a sales tax refund for up to four years.
- Documentation – Texas Tax Consultants will provide the required documentation to support your claims in the event your business is audited by the State.
Frequently Asked Questions
- What types of facilities and operations in Texas qualify for energy sales tax exemption?
- Manufacturing Operations of all types, including fabrication, assembly and/or processing, and all sizes of operations from small shops to large industrial facilities. For example: print shops, wood, clay plastic products, pharmaceutical, medical device, electronics semi-conductor plants, machine shops, chemical plants refineries, steel and textile operations, audio video recording production, and a vast array of other manufacturers;
- Food Beverage Processors and Bakeries (sub categories of manufacturing);
- Nursing Homes, Alzheimer Units, Assisted Living and Retirement Facilities (residential exemption);
- RV and Mobile Home Parks where the average tenant stay exceeds 30 days (residential exemption);
- Apartment Complexes Buildings and Condominiums (residential exemption);
- Agricultural and Horticultural operations (including irrigation, feedlots, animal food processing, fruit and vegetable growing processing, and plant nurseries);
- Golf Courses (for electricity used in pumping irrigation water and charging golf carts);
- Repairs to railroad “rolling stock”, jet aircraft engines, and national defense related “platforms”; and
- Oil, Gas, and Mining operations.
- What is the cost?
- Our fees are calculated on a percentage of the tax recovered from the State. We believe this type of arrangement is appropriate since fees will be based solely on restitution with no out of pocket expense.
- What do we need to get started?
- A signed engagement agreement;
- Your utility company may require a limited power of attorney; and
- A copy of your utility bill(s).