Rewards of Merit: Property Tax

Wiping Out Half of an OFS Company's Assessment

Client:

After emerging from bankruptcy, a publicly traded oilfield services company engaged Merit seeking cash tax savings opportunities.

Results for client

$4M

Annual Tax Savings

51%

Reduction in Annual Assessed Values

Challenge:

  • Client saw its tax liability rising as the stock price fell.
     
  • Previous tax consultant lacked industry experience to accurately calculate equipment values.

Merit Action Plan:

  • Conducted thorough review of repeatable opportunities for reducing annual tax liability.

  • Discovered previous consultant was using inflated equipment values to negotiate tax assessments.

  • With deep oil and gas expertise, Merit applied a more appropriate valuation methodology:

    • Used market values instead of valuing equipment at cost.

    • Secured adjustments for obsolescence and decreased asset utilization.

    • Provided assessors with extensive supporting documentation.

More Rewards of Merit