PSE&G approved a $16,500 adjustment and gave me the choice of refund check or bill credit. Client is asking which is better. I know the refund takes longer but gives them cash in hand. Any tax implications I should consider? This is for a manufacturing facility with pretty steady usage.
PSE&G refund vs credit - what's better for client?
I always recommend the refund check for amounts over $10K. Yes it takes 6-8 weeks longer but your client gets the money back in their account earning interest. Bill credits can take years to fully utilize depending on usage patterns. Tax-wise there shouldn't be a difference since it's a billing correction, not income.
Agree on the refund. PSE&G is actually pretty good about processing refunds within 45-60 days once approved. Plus if there are any future billing issues, you don't want a large credit balance complicating things. Cash is always better than credits in my experience.
Makes sense, thanks. Going with the refund option. Client is happy to wait the extra time for actual money back. PSE&G said 60 days so hopefully by mid-November.