Claws calculates severance tax on applicable run tickets for federal and all state taxing authorities. The user creates a tax group containing one or more tax rates. The tax group is then assigned to a lease and used to calculate run ticket severance tax.
The system creates both original and amended severance tax returns for several states including Texas, Louisiana, Oklahoma and Kansas. The filing system produces preliminary tax and error reports for each filing period. Additional states will be added to Claws as needed.
Tax groups are also used to calculate withholding tax by investor payment. Claws calculates state and federal withholding taxes at the division of interest level and reports the withheld amounts on the 1099-MISC.
The total tax liability for each taxing authority for a period is passed as an open accounts payable item to general ledger for payment to the taxing authority.