THE GELBER ORGANIZATION: REDUCING TAX EXPOSURE, MAXIMIZING CLIENT PROFITS

The Gelber Organization, with offices on the 26th floor atop Gateway One in Newark and satellite offices in New York City and Chicago, has gained a nationwide reputation as a multi-state taxation and profit enhancement consulting company. With a staff of a little more than a dozen top-notch, experienced

Arthur Gelber, of Cliffside Park, a certified public accountant who founded the firm in 1990, says his firm does no CPA work, traditional accounting, financial state preparation or initial tax return services. Rather, acting as an adjunct resource to its clients' staffs and outside accountants, The Gelber Organization has set the benchmark for maximizing profits and minimizing tax loads. The two areas are co-equals in revenue.

Spearheading the team are Gelber, 62, a 35-year veteran in state and local taxation, and Joseph G. Lerario, CPA, 56, of Robbinsville, executive vice president and a principal in the firm, who had been CFO of a $30-million corporate graphic arts firm. They have surrounded themselves with a phalanx of tax professionals, many of whom are former state tax directors and officials.

The newest additions are Joe Thiel of Jackson Township in Ocean County and Dennis Forte of Mantua in Gloucester County. Thiel, vice president of tax services, has had a distinguished 34-year career with the New Jersey Division of Taxation, including serving as deputy director. Forte, national director of client development, had been with Dryden Advisory Group, LLC, where he developed a sales tax refund practice.

Among other senior tax officials at the firm are: Domenick R. Sciortino, a 34year veteran of the New York State Department of Taxation and Finance and former direct of the Corporation Tax Audit Bureau; Robert E. Matson, former deputy secretary of revenue for taxation with the Commonwealth of Pennsylvania; Robert E. Anderson, former chairman of the Oklahoma Tax Commission; and Walter Hoffman, former chief of the sales & use tax auditing

staff for the State of New York.

Gelber says these are professionals who can talk the talk and walk the walk with governmental taxing officials. "During our many years of experience, we have met with the multi-state taxing authorities, obtained positive rulings for clients and assisted trade groups in obtaining favorable interpretations of complex industry-wide issues," he explains. "We have also represented clients during audits conducted by the taxing authorities and in the appeals process.

The company offers its professional advisory services on a fee basis (ranging from $175 to $450, in Arthur Gelber's case) and offers profit enhancement programs on a fee contingent basis. For the latter, there is no charge unless the client saves money as a direct result of Gelber's work. "It's a performance procedure," says Gelber "If we perform, we get paid."

One client, a Fortune 500 company with sales in all 50 states, retained Gelber to evaluate its taxable exposure in each of the states in which it was not registered. The client had estimated a substantial contingent liability for these taxes. "We identified the states in which the client performed activities which would likely be deemed taxable by those states," says Gelber. "We contacted a number of those states and reviewed our audit finding with them without identifying our client. To date, we have successful negotiated settlements with states resulting in a $2.5 million reduction in the client's liability."

In another case, a medium-sized printing company was able to save $30,000 in two months and over $100,000 over the next five years in unrequired sales tax payments as a result of Gelber's analysis of the client's purchasing procedures.

One client, a multi-national producer of optical and photographic equipment, retained Gelber to perform a tariff management study of its import-export activities. "Our study resulted in the reclassification of certain imported items and the expansion of items which qualified for 'duty drawbacks.' (Duty drawback are refunds of duties paid on imported items which are subsequently exported.) We have secured annual duty burden savings of about $500,000 per year."

"We take on the challenges of all state tax issues across the country," declares Lerario. "I just came back from California, where I managed to find a lower assessment for a major retailer. We found an area for a refund. As a result, we increased the client's cash flow and decreased the tax burden."

Thiel, the veteran of State of New Jersey taxation, says it is important to understand the tax law and to live with it. He says the single most often made mistake by companies is overlooking items and overpaying. "State auditors look for underpayment, while we go into a firm and look for those areas to uncover tax rebates,"

Art Gelber recalls that his executives were called into a computer hardware business to review the results of a sales tax audit. Gelber executives toured the facility and had to put on special overshoes so as not to generate static electricity. Also, special coatings had to be used on the floors. The firm paid sales taxes on these items. Gelber got them exempted, because they were not normal maintenance items.

The tax advisory portion of the business involves such things as: representing clients on multi-state sales tax, use tax, franchise and corporate income tax audits; reviewing recently issued audit reports for possible refunds; utilizing the many exemptions and tax benefits available; assessing the risk of future multi-state sales tax, use tax or local tax liabilities. The profit enhancement side of the business involves ensuring that the client gets the full benefit of sales and use tax exemptions and/or tax credits. A key area is the custom duty tariff reviews so clients can reduce their duty burden.

The Gelber Organization is already planning on expanding further, perhaps adding as many as six new people over the next year or so.