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Ext. PublicationSpecialty Tax Spotlight — Ad Valorem and Severance Tax Planning Part 1
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Specialty Tax Spotlight
In this episode of Specialty Tax Spotlight, Mayur Naik, Tanner Owens and Stephen Arredondo begin a three-part series on ad valorem and severance tax. The conversation reveals the hidden opportunities companies can explore by simply revisiting and realigning their tax practices.
Key Points:
- Early strategic planning is particularly important for companies with mineral interests.
- Companies should review their severance taxes to identify ways to lessen taxable value and seize potential incentives.
- A secondary review of tax processes may optimize compliance and uncover hidden cost-saving opportunities.
The conversation kicks off with an emphasis on early planning, particularly for companies with mineral interests scattered over Texas and beyond. With frequent ownership changes and varying statuses of wells, Stephen highlights the need for a proactive approach and planning to avoid crunch times, thus setting the stage for effective tax management.
Tanner underscores the pressing need for companies to assess their severance taxes. He speaks about the potential to lower taxable values and investigate incentives for approaching wells coming online, all hinting at the hidden opportunities that well-timed and informed planning could unveil. “This is a perfect time to take a look from top to bottom and see kind of what the opportunity is — or if you’re doing it correctly or if you’re not doing it correctly — it’s kind of the best time,” explained Tanner.
Extra value can be extracted from a secondary review of tax processes, which includes a second pair of eyes on existing practices. Businesses that carry out such reviews generally have superior preparedness for policy shifts and are better equipped for implementing effective tax management strategies. This step can optimize compliance and unveil latent cost-saving opportunities.
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Ad Valorem and Severance Tax Planning Series
Tune in for a comprehensive three-part series on ad valorem and severance tax, where Weaver’s tax professionals uncover hidden opportunities to optimize tax practices, reduce burdens and maximize savings. Don’t miss out on valuable insights that could transform your company’s tax approach!
