A typical KPMG M&E tax review often results in a 10 to 15 percent reclassification. For a company with a 40 percent effective tax rate and a disallowed meals and entertainment expense of $3 million per year, a reclassification can amount to an additional $180,000 in permanent tax savings. Now multiply this by up to three years (as provided by Rev. Proc. 2004-29) and the value of our reviews becomes even more apparent.
It all adds up to advantages you can count on:
- Increase cash flow by identifying M&E that should be deducted at 100 percent, which can permanently reduce your federal and state tax expenses
- Mitigate risk by identifying and addressing potential tax exposures
- Reduce effective tax rate by identifying potential permanent tax deductions
- Control spending by helping M&E and/or p-card administrators identify frequent user errors; time periods in which unusually high errors can be found; and areas of company policy that may require further clarification
- Implement better controlsso your processes are enhanced for the future
- Create IRS audit-ready electronic deliverables that provide supporting documentation in case of audit
Contact:
For more information on how your company can increase saving and reduce its effective tax rate, contact:
Peter C. Beale
Partner – East Leader
T: 267-256-3370
E:
pbeale@kpmg.com
Edward Moragas
Partner and Technical Advisor – East
T: 973 912 6428
E:
emoragas@kpmg.com
French L. Taylor II
Partner – West Leader
T: 214-840-4148
E:
frenchtaylor@kpmg.com
Mark E. Barrus
Partner and Technical Advisor – West
T: 216 875 8376
E:
mbarrus@kpmg.com