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Companies can recover thousands — in many cases, millions — of dollars in employment tax overpayments; amazingly, many companies fail to do so.

These over-payments can occur in numerous ways. Here are three common scenarios:

• After M&A activity, an acquirer may have rights to previous predecessor employment tax contributions and experience ratings. Employee migrations and related rights are subject to a complex myriad of tax laws (which vary by jurisdiction) and many other factors.
• A change in corporate status to an LLC or LLP may carry employment tax rights which companies often overlook.
• Common undiscovered errors, such as incorrect reporting numbers and duplicate reporting, often result in overpayment of tax.

ETS can help. Through our STAR Program (Statutory Account Review), ETS identifies eligible recoveries triggered by historical M&A and prior employment tax account activity, still within statutes of limitations. STAR also brings to light outstanding and potentially unrecognized compliance issues- thus limiting penalties and interest while maintaining compliance. Clients often request a STAR review in the wake of an acquisition, merger, divestiture, IPO, other public or private sale of securities, or any other event where unrecognized / undisclosed liabilities or compliance issues could result in serious legal or financial exposure.

We engage the situation after the fact (but within statutes) to perform a comprehensive historical review of tax accounts and identify areas of potential savings and non-compliance. From there, we use our in-depth knowledge of federal and state employment tax law — and our familiarity with the agencies involved — to interact with the taxing authorities for the benefit of the client.

Result: ETS generates refunds and future savings where allowable by statute, while limiting potential penalties by identifying compliance issues. Please see how ETS achieved these results in a recent case.

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