Microsoft And The IRS Back In Court

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Posted 2 years ago


Microsoft And The IRS Back In CourtMicrosoft is once again locked in a courtroom tussle with the Internal Revenue Service, this time over the latter’s recent hiring of a person of interest.

The lawsuit, filed on May 29th in Seattle, Washington, asks that the court answer its request to make public the documents concerning the IRS’ hire of lawyer David Boies in connection with a federal audit they are currently fighting against.

The audit, levied in 2012 concerns billions of dollars of income spanning the years from 2004 up to last year and is still being enacted.

Boies was a key lawyer who had gone against Microsoft before in an antitrust lawsuit brought against them in 2000, which the company lost.

The current audit concerns Microsoft’s transfer pricing policies and whether they took advantage by shifting their profits to countries with low tax rates or no tax rates at all to avoid paying the customary 35 percent tax rate in the United States.

The IRS defended the hire in a separate court filing stating that it was necessary for their case.

Microsoft is incensed over the agency’s use of non-government individuals in a sensitive federal case such as this, and they have strong support from members of Congress including Utah Senator Orrin Hatch who wrote to the IRS as head of the Senate Finance committee.

Boies didn’t comment on the revelations, and the IRS made no comment citing that it is not their policy to do so with pending litigation.

David Cuddy, a spokesman for Microsoft stated: “We’re pleased the IRS provided the documents requested by one of our previous FOIA suits and hope this additional suit helps complete the information we need to further understand the government’s process.”

A decision in the case is not expected for at least another year.

Christopher A. Smith


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