Google said it plans to file a suit against the US Internal Revenue Service about domestic tax despite. It will be filed in US Tax Court regarding the online search giant’s 2003 and 2004 tax bills. The amount at stake is not material to the company.

Google announced the upcoming lawsuit in its yearly 10-K report with the Securities and Exchange Commission filed January 29. In the SEC filing, the company said it already settled its outstanding 2003 and 2004 issues with the IRS during 2012except for the issue that it plans to file in court. The filing indicated no additional details on the substance of the dispute or the amount of money involved.

Dean Patterson, spokesman for the IRS, didn’t comment about the issue. Federal privacy laws prohibit the IRS from discussing cases involving individual taxpayers and companies.

Google has been probed by tax authorities across the globe, including France, Italy, Australia, and the UK. The company shift profits out of the United States and into low-tax countries. It used techniques known as the Double Irish and Dutch Sandwich that route profits through Ireland and the Netherlands into Bermuda.

In Google’s annual filing with the SEC, it reported its effective tax rate as 19.4 percent for 2012, which is down from 21.2 percent in 2010 and less than half of the combined US federal and state statutory rate of 39.1 percent.

In 2011, the company avoided paying out around $2 billion in taxes by shifting $9.8 in revenue to a Bermuda subsidiary. In 2011, the IRS audited Google’s offshore deals and investigated how the company valued software rights and other intellectual property it licensed overseas.

In 2006, the IRS signed off on a 2003 intra-company transaction that moved foreign rights to Google’s search technology to foreign soils. Future profits from the intellectual property were reported outside the country.

About The Author

A freelance writer, eBook author and blogger. A work from home who loves to stay updated with the buzz in the tech world and a self confessed social media freak. Currently works with

Related Posts

Leave a Reply

Your email address will not be published.