Customer Story
Leading Insurance Provider Automates Tax Withholding, Decreases Reconciliation Time by 85% and Error Rate by 98%
Products
Annual Premium Revenue
Industry
Operations
Benefits
Reduction in quarterly reconciliation time (from 5 days to 18 hours)
Decrease in error rate (from 7.2% to 0.14%)
Annual tax withholding transactions automated
Automated audit-ready documentation achieved
The Company
Business Model: Provides life insurance, annuities, disability income insurance and retirement planning products
Assets Under Management: $42+ billion
Number of Policyholders: 375,000+
Tax Filing Jurisdictions: 50+ states and territories
Annual Tax Withholding Transactions: 30,000+
The Challenge
When a seasoned tax manager joined the team at a leading insurance company, she quickly discovered a completely manual tax withholding process with no specialized solution in place. Despite handling complex tax requirements across multiple entities, the company was relying entirely on basic tools and manual reconciliation.
“I think I looked like a deer in the headlights while watching my peer trying to explain this process,” the tax manager recalled. “They had all these different spreadsheets open, pieces of paper with totals, just trying to compare states.”
The company’s existing approach to managing tax withholding was not only inefficient but also created significant compliance risks, including:
- Multiple spreadsheets tracking withholding information for different jurisdictions
- Separate filings for each state across multiple entities
- Time-consuming manual processes creating compliance risks
- No specialized solution to manage complex withholding requirements
If this challenge sounds familiar to you, it’s worth connecting with a Sovos Expert so we can take this compliance burden off your shoulders.
The Solution
Drawing on prior experience with Sovos solutions, the tax manager immediately recognized the need for Sovos Taxport’s withholding module and made implementing it a top priority.
The implementation strategy included:
- Deploying Sovos Taxport’s withholding module for automated processing
- Completing reporting agent forms to consolidate multiple employer identification numbers
- Streamlining three separate entities under one reporting structure
- Eliminating redundant state filings
“It was the very first thing that I changed when I came on board,” she explained.
The Results
By implementing Sovos Taxport, the insurance provider achieved:
Streamlined Operations
- Consolidated reporting from three separate entities into one cohesive process
- Decreased quarterly reconciliation time by 85% (from an estimated 5 days to 18 hours)
- Reduced administrative burden across the tax department
Enhanced Efficiency
- Replaced manual spreadsheets and paper notes with automated processing
- Centralized 50+ state filings into a single unified system
“I knew how easy Taxport was making it,” noted the tax manager, comparing the new system to the previous manual approach
Improved Compliance
- Decreased error rate by 98% (from 7.2% to 0.14%)
- Enhanced visibility into cross-jurisdictional requirements
- Reduced risk of missed deadlines or reporting errors
- Achieved 100% automated audit-ready documentation
Resource Optimization
- Freed tax department resources equivalent to 2.9 full-time employees
- Created a scalable solution that could accommodate business growth
For this insurance provider, partnering with Sovos and implementing Taxport wasn’t just about technology adoption—it was about transforming their entire approach to tax withholding management.