Wow what a tax bill

Forum|Forum|2 years ago
October 13, 2023
4 replies
31 views

I just read that the IRS said that Microsoft owes it approximately 29 BILLION dollars.

ProSeries Professional

This topic has been closed for replies.

Best answer by IRonMaN

I just Googled the deal and kind of shook my head:

'ProPublica and Fortune reported in 2020 that the tech giant had moved "at least $39 billion in U.S. profits" to Puerto Rico in an effort to avoid taxes. Accountant KPMG had arranged a tax rate close to 0% with the local authorities, the report said. '

I wonder what kind of tax rates KPMG could arrange for me if I gave them a call 🤔 🤔

As a side note, I was attending a CPE class several years ago and one of the speakers was a former KPMG employee. He mentioned that he used to work for KPMG before they became a radio station. That line always stuck with me 😁

Jim-from-Ohio

Intuit Community Champion

they must have so much cash as the stock market basically considered it a non-issue

IRonMaNAnswer

Level 15

I just Googled the deal and kind of shook my head:

'ProPublica and Fortune reported in 2020 that the tech giant had moved "at least $39 billion in U.S. profits" to Puerto Rico in an effort to avoid taxes. Accountant KPMG had arranged a tax rate close to 0% with the local authorities, the report said. '

I wonder what kind of tax rates KPMG could arrange for me if I gave them a call 🤔 🤔

As a side note, I was attending a CPE class several years ago and one of the speakers was a former KPMG employee. He mentioned that he used to work for KPMG before they became a radio station. That line always stuck with me 😁

Slava Ukraini!

BobKamman

Level 15

Microsoft pays its lawyers a lot more than IRS pays its lawyers. Also, the Microsoft lawyers probably get stock options. Can you imagine if the US government issued options, what they would be worth these days?

PATAXAuthor

Level 12

@BobKamman @IRonMaN @Jim-from-Ohio if they do actually owe this then I hope the IRS does not reach a bargain agreement with them, and I hope they make them pay back every single penny, i.e. I'm tired of this nonsense. Everyone should pay their fair share of taxes, from the poorest to the wealthiest.

BobKamman

Level 15

I just read the ProPublica story and found that

" IRS set out to be bolder and more aggressive. It took the unusual step of hiring a corporate law firm to represent the agency, a step that incensed Microsoft. The company, along with others in its industry, responded by rallying allies in Congress to rein in the IRS."

Private lawyers make a lot more per hour than government lawyers, and probably Microsoft is using some of those also (rather than in-house employees with stock options and other incentives). But this case is far from being decided, and there is nothing for Microsoft to "pay back" because the issue is whether it should have paid more when the return was filed.

The $29 billion is a drop in the bucket compared to what American global enterprises have saved by shifting their profits to low-tax jurisdictions like Ireland. There are efforts being made to close this loophole with the "global minimum tax." Republicans, of course, are opposed. So maybe their leader's tombstone will read, "He was a lecherous narcissist but he kept the price of Windows down."

PATAXAuthor

Level 12

@BobKamman yeah that's what I meant: pay what they should have paid. Thanks for that information on Ireland. Now I know why a couple of my stocks that my broker put me in are companies based in Ireland.

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