Case Study: Sales & Use Tax

Defending an Oilfield Service Company Under Audit

Defending an Oilfield Service Company Under Audit

CHALLENGE

A publicly traded oilfield service provider faced a $26 million sales and use tax audit liability. After more than 10 years of audits, the company had accrued over 25% in penalties and interest. Without a solution, its liquidity crisis would worsen.

MERIT SOLUTION

Merit Advisors’ experts in audit liability and settlement services helped the client avoid bankruptcy by:

  • Securing immediate reductions with the auditor to reduce liabilities
  • Negotiating a settlement with the state that facilitated a closure of the audits, increased reductions and established a more attractive repayment structure
  • Developing a new use tax compliance process to prevent future errors

RESULT

The company saw a $17 million reduction in audit liabilities, including a waiver of all penalties and accrued interest.

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CHALLENGE

A publicly traded oilfield service provider faced a $26 million sales and use tax audit liability. After more than 10 years of audits, the company had accrued over 25% in penalties and interest. Without a solution, its liquidity crisis would worsen.

MERIT SOLUTION

Merit Advisors’ experts in audit liability and settlement services helped the client avoid bankruptcy by:

  • Securing immediate reductions with the auditor to reduce liabilities
  • Negotiating a settlement with the state that facilitated a closure of the audits, increased reductions and established a more attractive repayment structure
  • Developing a new use tax compliance process to prevent future errors

RESULT

The company saw a $17 million reduction in audit liabilities, including a waiver of all penalties and accrued interest.

The Rewards of Merit
$17
million
Reduction in audit liability