How a Predominant Use Study in Missouri Works

by | Jul 21, 2022 | Finance

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The completion of a predominant use study in Missouri could prove to be a valuable investment for companies looking to reduce some of their costs. In particular, it is ideal for organizations that are manufacturers or industry processors in facilitates that are eligible for a utility sales tax exemption.

What to Know About Your Rights

In Section 144.054, RSMo, a right to a tax exemption exists in the state for qualified companies for a wide range of energy use. This may include electric, gas, natural gas, artificial gas, propane, chemicals, water, coal, and others. It applies to companies that are engaging in manufacturing, mining, compounding, processing, or processing recovered materials, as well as companies engaged in manufacturing, processing, mining, or processing for research and development.

A predominant use study in Missouri may be necessary to qualify for this exemption. This study will include a list of all equipment and appliances used within the organization for qualified purposes. It will also document the annual consumption of each component. This determines if the company qualifies for the exemption.

How to Get Started

For organizations that believe they qualify for this sales tax exemption based on their energy consumption, having a third party complete a predominant use study in Missouri is often the first step. Turn to an organization that specializes in these studies to ensure no mistakes are made during the process. A small mistake could mean denial of this very valuable exemption for many companies. When looking for a predominant use study in Missouri, look to B. Riley Financial, Inc. as they have a team of experienced professionals that can help you.

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