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Frequently Asked Questions

  1. What is “tax integration” and why is it important?

    Post merger and acquisition tax integration includes the identification of pre-acquisition tax risks, complying with any tax compliance requirements inherited from the merged or acquired entities and implementing required structural changes to minimize tax costs and risks of the newly formed group.

  2. What types of taxes are involved?

    All areas of tax are covered, including income taxes, sales and use taxes, property taxes and payroll taxes.

  3. What are some examples of common risks minimized through an effective tax integration process?

    A common problem includes an unintended taxable transfer of assets from one entity to another such as the transfer of intangible assets from one jurisdiction to another.  Legal title to intangible assets such as patents and trademarks should not be transferred until the tax issues have been identified.  Other problems include maintaining inactive entities, late tax return filings and expiration of tax indemnification agreements before all task risks have been identified.

  4. How does a Tax Department Outsourcing service compare to traditional tax services arrangements?

    In an Outsourced Tax Department arrangement BCOTAX is involved in a wider range of services and is more involved in the day-to-day operations of the client’s business. Examples include reviewing customer contacts to address tax issues, responding to notices and tax planning for future business expansion.

  5. What is the typical candidate for Tax Department Outsourcing?

    Tax Department Outsourcing is appropriate when a company has a need for on-going tax support but is too small to invest in an in-house tax department. As a company grows it can shift to a co-sourcing or in-house solution.

  6. What investments are required for an in-house tax department?

    An in-house department requires an investment in qualified tax professionals, on-going training, tax libraries and tax preparation software. BCOTAX eliminates the need for a company to make this investment by providing an outsourced tax department solution.

  7. What is a “tax provision” and “accounting for income taxes”?

    US generally accepted accounting principles (“GAAP”) provides the rules for accounting for income taxes including the accounting for income tax uncertainties. The rules are contained in ASC 740 (formerly FAS 109 and FIN 48).

  8. What are the components of a tax provision?

    The tax provision calculations include the computation of taxes currently payable, measurement of deferred income taxes, evaluation of tax risks (“uncertain tax positions”) and preparation of tax disclosures.

  9. Does BCOTAX provide tax provision services to both public and privately held companies?

    Yes, BCOTAX provides services to both publicly traded and privately held companies.

  10. Describe the tax planning process?

    Tax planning requires the understanding of the client’s business operations and market, the objectives of the client and the identification, measurement, selection and implementation of tax planning strategies.