IRS says Microsoft owes an additional $29B in back taxes

https://www.cnbc.com/2023/10/11/irs-says-microsoft-owes-an-additional-29-billion-in-back-taxes.html

by donohoe • 3 years ago

111 33 3 years ago

When you are a top 10 company, will the IRS converse & let you know why they think you owe what they say you do? Or is it like the rest of us plebes where we only ever guess why their numbers are different & what fines we might have been dinged by?

dgrin91• 3 years ago

Even the plebs can talk with the IRS. They actually have call centers & dispute processes. The key factor is that most of us plebs don't have the time, knowledge, energy or willingness to go through the process.

Microsoft will hire some lawyers/accounts (or already has inhouse) to handle it.

PopAlongKid2• 3 years ago

like the rest of us plebes where we only ever guess why their numbers are different & what fines we might have been dinged by?

That is not true. The IRS sends letters through U.S. mail when they propose a change to the return you filed, and whether there is a refund or additional balance due, they indicate what numbers differ and what penalties, if any, were applied.

You can then either accept the change, or disagree and reply with your position on the matter.

I've seen dozens of such letters over the years (both my own and others).

jauntywundrkind2• 3 years ago

I've seen a bunch of such letters, thankfully with mostly small adjustments and most mysterious to me often giving me some money back.

But I've never felt like I've had any clue why things were adjusted or what issues there were.

I'm probably way off base & things aren't actually so bad, but I feel like I get a lot of sympathetic "me too"'s about this in social circles. Maybe a good number of people are just holding their tongues & actually understand & learn from their errors over time, but I don't feel like my tax filing skills have ever improved.

aaomidi• 3 years ago

While reminding you, interest is accumulating.

HWR_14• 3 years ago

The IRS will let you know what they think you owe. They will tell you why. And, AFAIK, tends to waive fines if the mistake was honest and quickly corrected.

jaybeavers• 3 years ago

This was my experience too. While it takes a good long while to get resolved, because my mistakes were accidental and I talked it through and followed the process, I was dealt with politely and given grace.

All in all a scary but good experience.

wkat42422• 3 years ago

Wow that's nice. In Holland the government always assumes you did it on purpose even though usually that isn't actually the case.

xyzzy123• 3 years ago

Yes, there are special teams for these huge companies because their tax affairs are so complicated.

Typically these very large orgs will also have dedicated relationship managers.

sansah• 3 years ago

Have they already started using (Microsoft's) AI to process those returns? As they said so.

https://www.cnbc.com/2023/09/12/irs-plan-to-use-ai-may-affec...

https://www.irs.gov/newsroom/irs-announces-sweeping-effort-t...

wkat42422• 3 years ago

Government shutdown solved lol. That should cover it for a couple more months.

BXlnt2EachOther• 3 years ago

based on 2022 outlays (6.27T), it's unfortunately about 40 hours.

sharts• 3 years ago

So send the majority shareholders and directors to jail until everything is paid in full, including interest on it.

Corporations are people after all

ryanschaefer• 3 years ago

I’m baffled by your comment. This wouldn’t benefit the government at all. They just want their money and wouldn’t want to collapse a major American enterprise over money they will collect by any means necessary.

safety1st• 3 years ago

It's just a classic social media hot take with no thought behind it, designed to get that instant sweet dopamine from upvotes rather than advance the discussion.

30 years of the web and we still haven't worked out how to discourage this (HN does a better job than most though)

guappa• 3 years ago

It might encourage other companies to pay their taxes though.

sobkas• 3 years ago

I’m baffled by your comment. This wouldn’t benefit the government at all. They just want their money and wouldn’t want to collapse a major American enterprise over money they will collect by any means necessary.

Ah America the land of rule of law*

*Only enforced if small and/or poor, wealthy and powerful only need to give Government their cut("fine") and no one is held accountable(often even without admitting any wrongdoing). It's rotting the justice system because people see this and no longer care to abide by any of them(cops won't catch vast majority of criminals, for various reasons so fear of punishment isn't a thing). Including cops that have no obligation to enforce any laws, and they don't, so they can play Pokémon Go in peace(but they can break your rights as long they don't know it's a right and it's not widely enforced by courts).

seanhunter3• 3 years ago

1. Corporations aren't people in every possible sense. Consider most of what you might read random sources say on the internet about corporate personhood to be probably nonsense.

2. Shareholders aren't officers (in the general case), so won't have been part of the decision-making or execution processes that led to this fraud (if that's what it is). So my understanding is they can be deemed to have been "unjustly enriched" by it (and so have stuff taken away from them that they shouldn't have) but can't be held personally liable in the sense that they would be jailed. To do that would be grossly unfair.

Consider that the biggest shareholders of any major corporation are going to be pension funds and the like. So you've got say the California State Teachers Pension (Picking one at random to be specific). You think they should go to jail because their mandate says they have to track the S&P500 to within some % and so they bought MSFT because it's part of the S&P500?

cdolan• 3 years ago

A question I have not seen but think is critical;

How can the IRS go after anyone for taxes owed between 10 and 20 years ago?

Is there no statute of limitations?

TheChaplain• 3 years ago

IMHO it doesn't make it a less of a crime if it happened 10+ years ago.

Tax fraud is robbing society, and no matter who they are, everyone should pay a fair share if they wish to participate with said society.

manuelmoreale• 3 years ago

Especially considering the amounts involved. Going after an individual because they made a mistake in their taxes 20 years ago is one thing. Going after one of the biggest company in the world because they have 29B to give it’s another.

kuchenbecker• 3 years ago

But there are statutes of limitations; evidence for your defense may have so far degraded or been unavailable.

pests• 3 years ago

Taxes don't pay for society though.

It's not like we raise taxes, use it to pay for society, and repeat. We decide to pay for it, do it, and maybe recoup some of the costs. That is why we have a deficit right?

Microsoft not paying $30B did not cause society to lose out on $30B.

That $30B got spent a long time ago. Now it will just sit contributing a little to the 11th digit of the national deficit.

seanhunter3• 3 years ago

Generally the limitation on back taxes is 10 years according to this source[1], but there is no limitation in the case of filing a fraudulent or false return or willfully attempting to evade tax. [2] is the official source. I dug around a bit and it looks like it is the same for businesses as individuals although I haven't got a source that says that crisply.

[1] https://www.findlaw.com/tax/tax-problems-audits/what-is-the-.... [2] https://www.irs.gov/filing/statutes-of-limitations-for-asses...

IRS says Microsoft owes an additional $29B in back taxes

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