The challenge
Reed Smith’s tax clients rely on the firm to analyze their state tax positions and look for potential savings. That means pulling detailed information from lengthy combined state tax returns, finding specific data across multiple schedules, and matching each value to the right field. The process was labor-intensive and time-consuming.
Finding the right information was only part of the job. The team also had to preserve the structured output the legal team needed. The initial use case focused on tax base and apportionment schedules.
Our solution
Reed Smith Legal Solutions built a workflow in Hebbia, an AI platform for enterprise document analysis, to extract tax base, apportionment, and liability data for members of consolidated filings from combined tax returns running thousands of pages. That gives Reed Smith attorneys a structured way to model client savings opportunities instead of relying on a manual, input-by-input process.
When document quality got in the way, the team added an automated preprocessing step to improve readability before analysis. Quality checks then confirmed that the workflow captured the data and aligned it with the right fields.
Hebbia fit the work because it could repeatedly extract structured information into defined fields and tables. Its matrix-based approach helped the team organize and validate the results while keeping each data point traceable to the underlying documents.
The results
The workflow helps Reed Smith tax lawyers analyze clients’ state tax positions faster and more accurately, so they can identify savings opportunities sooner. The team has already put it in place for New Jersey and plans to extend it to other states.
The approach also proved adaptable enough to support a related project applying the same extraction method to invoice data for sales and use tax purposes – extending the client benefit to another area of tax compliance. Together, these efforts show how AI can enhance the quality and speed of the service Reed Smith delivers to clients while preserving the oversight required for legal work.
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