Zachary Halaschak is an economics reporter at the Washington Examiner. Before moving to Washington, he worked in Alaska, covering politics, government, and crime for the Ketchikan Daily News. While there, Zach won the Alaska Press Club’s second-place award for best reporting on crime or courts for his coverage of a local surgeon’s alleged murder.
Microsoft revealed on Wednesday that the IRS is attempting to collect $28.9 billion in back taxes but says it will appeal, a process expected to take years.
The revelation comes after an IRS audit into Microsoft that spanned from 2004 to 2013. The IRS determined that the tech giant owes an additional $28.9 billion in taxes, plus penalties and interest, according to a press release put out by Daniel Goff, the company’s corporate vice president of worldwide tax and customs.Goff said that Microsoft has been working with the IRS on the audit for nearly a decade.
Microsoft said that it disagrees with the IRS conclusion and will appeal. The company also noted that not included in the proposed adjustments are taxes paid by Microsoft under the Tax Cuts and Jobs Act, also known as the Trump tax cuts, which it claims could reduce the final dollar amount owed in the audit by up to $10 billion.
“Microsoft disagrees with these proposed adjustments and will pursue an appeal within the IRS, a process expected to take several years,” Goff said. “We believe we have always followed the IRS’s rules and paid the taxes we owe in the U.S. and around the world. Microsoft historically has been one of the top U.S. corporate income taxpayers.”At the heart of the audit are questions about the way the company allocated profits among countries and jurisdictions from 2004 to 2013.
When contacted by the Washington Examiner for comment, an IRS spokesman said the agency doesn’t publicly comment on such cases.
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