Dan Filby of First Advantage, a solution provider at the marcus evans CFO Summit XXVI Spring 2013, on maximizing opportunities in tax credit and incentive programs. Interview with: Dan Filby, Executive Vice President and Managing Director of Tax Consulting, First Advantage

1. Interview with: Dan Filby, Executive
Vice President and Managing
Director of Tax Consulting, First
Advantage
“To maximize the benefits that
organizations can derive from daily
business activities, Chief Financial
Officers (CFOs) need to make sure that
the tax function understands the best
practices around federal and state tax
credit and incentive programs, and what
drives their success,” says Dan Filby,
Executive Vice President and Managing
Director of Tax Consulting, First
Advantage.
From a solutions provider company
attending the marcus evans CFO
Summit XXVI Spring 2013, in
Mashantucket, Connecticut, May 19-21,
Filby shares best practices for
maximizing opportunities in statutory
and discretionary tax credit and
incentive programs.
What opportunities are CFOs
missing out on?
Almost all CFOs today are looking for
ways to drive efficiencies and
investigate all expenditures, but they
may be missing valuable benefits they
can derive from business activities
performed every day e.g. hiring, capital
investments, employee training, new
business development, or facility
upgrades. For example, a company can
capture up to a USD 9,600 federal tax
credit for hiring a veteran, which is a
significant amount if it is hiring many
people who fit that targeted category.
Ideally, companies can generate
millions of dollars in tax credits annually
by taking advantage of tax credit
programs offered throughout the US.
However many opportunities are often
overlooked as CFOs have neither the
time nor the resources to monitor all
potential tax credits, as well as
recognize the intricacies of each
individual program.
How could CFOs get more out of
these programs?
There are over 2,000 tax credits and
incentives across the US that companies
have available to them. Many are
difficult to access, so businesses can
potentially miss out on millions of
dollars of opportunity. To avoid this
from happening, it is essential that
CFOs emphasize to their tax team the
value and importance of identifying and
administering tax credits.
The right approach to ensure a business
is maximizing their full incentive
potential is from a best practices
standpoint. Do not try to understand all
the program intricacies, but identify and
apply the best practices around the
programs.
What are these best practices?
A company’s internal tax team should
have visibility to strategic investments
that the organization is making. Most
CFOs know if they are buying a
company or building a new plant in
another geography, but have the tax
folks had their input into that decision?
The strongest best practice regarding
the capture of tax credits and incentives
is to be proactive and advise your tax
department of any future plans for
business activity e.g. job creation,
capital investments or new business
development. Tying the tax team in
strategically to those discussions is
critical to maximizing the benefits of
incentives, whether statutory or
discretionary.
One best practice is to screen all new
hires to identify if the company could
potentially qualify for any hiring tax
credits. This best practice can be
performed from a simple questionnaire.
Another best practice for businesses
experiencing job creation in multiple
locations would be for the internal tax
team to analyze the benefits of hiring
and training 200 people at one site
location versus another.
Next, it is critical that CFOs ensure that
all the compliance work is done well.
Many documents and forms have to be
submitted to capture tax credits, and
often require extensive administrative
follow-up. Additionally, pre-certifications
are often required to capture the tax
credits. A best practice would be for the
tax team to establish metrics around a
particular program. For instance, a
hiring tax credit program metric would
be screening compliance: what
percentage of your new hires screened
were actually eligible, and from what
targeted groups?
If I were to step up 500 feet and take it
from a much higher view, I would also
make sure I was familiar with all key
performance indicators (KPIs) and
measuring the success of the programs
across the board.
A CFO must also look for opportunities
to innovate. Much of the compliance
work is done manually, and the
processes and incentives differ in every
state, so a vendor could reduce costs by
automating processes, and more
importantly, improve some of the KPIs.
Do not try to
understand all
the details,
but identify
and apply
the best
practices
around the
programs
Making the Most of Tax Credits and Incentives
on Business Activities Performed Every Day

2. About First Advantage
First Advantage develops and implements strategies to reduce an organization’s tax liabilities and increase profits/earnings per
share. We provide services that help organizations capture the federal work opportunity tax credit, state and local credits, as well
as training credits and grants, tax abatements, exemptions, and rate reductions. Additionally, we have a proven process for
identifying and negotiating incentives that supports our clients’ business investments, with services including incentives
negotiation, location selection with incentives negotiation, and development of a “best practices” process for identifying incentives
opportunities within our clients’ organization.
Working with First Advantage allows organizations to gain tax expertise without increasing head count, capture all applicable tax
credit and incentive opportunities, meet all tax filing deadlines, satisfy any compliance requirements, and integrate software
applications with internal systems to increase efficiencies.
www.FADV.com/tax
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About the CFO Summit XXVI Spring 2013
This unique forum will take place at the MGM Grand at Foxwoods Resort and Casino,
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conference, exhibition or trade show, this exclusive meeting will bring together
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interactive networking event. The Summit includes presentations on bringing more
focus to balance sheet health, helping companies to find profitability growth and
motivating top finance performance.
www.cfosummits.com
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