In-House Tax Help is Part of a Hospitality Company's Evolution

By David Chitlik Vice President - Hospitality Tax, Altus Group | October 16, 2016

Your hospitality business is small, with a single hotel or locations in only a few tax jurisdictions.
Your accountant is taking care of compliance quite well, with the help of a local, seasonal tax
specialist. But as you grow, expanding to another state, another region, it's time to seek tax expertise.

Hiring an in-house state and local tax professional is often part of the evolution of a hospitality
business. Its decision criterion is generally the same as that of any other position, arrived at
through a cost-benefit analysis, and there are any number of metrics that can be used. For
example, you can look at your tax bill and decide that it's worth the price of a salary to reduce it.
You can look at your consultants' bill and decide that having your own tax specialist would be
cost-effective.

But ending the decision criteria there can leave you open to unexpected down-the-road costs as
the reality of operating in widespread locations becomes apparent. You have to look toward
the future because, as a tax burden grows, the importance of hiring a tax specialist who is
conversant with a hospitality company's needs and nuances can have an increasingly positive impact on the bottom line.

There is even a potential decision path that can correspond to a company's evolution. From the accountant, the company's needs can often be satisfied by an outside tax consultant, but continued growth can require in-house local and state tax professional. More growth can justify a tax team that includes property, sales and use, hospitality and personal property tax specialists. Eventually, it's possible that the tax team will need help from consultants capable of dealing with local issues that impact the various properties.

Yet company growth in itself isn't the primary driver for this staff expansion. Let's
look at those drivers:

  1. Location, Location, Diverse Locations

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