#Facebook Sued By The #IRS For $9 Billion In #Unpaid #Taxes; #socialmedia

New York (The Verge) — Facebook sued by the IRS for $9 billion in unpaid taxes theverge.com/2020/2/19/2114….

Facebook has been sued by the IRS for $9 billion in unpaid taxes. The IRS argues that Facebook undervalued intellectual property it sold to an Irish subsidiary in 2010.

Many giant tech companies shelter billions from taxes by keeping their money in Ireland because of the country’s low corporate tax rates. That often involves creating Irish subsidiaries that license out proprietary technology, trademarks, and other company property for which the subsidiary then pays royalties. The IRS claims Facebook undervalued the royalty amount between 2010 and 2016, which cut the company’s domestic tax bill as the royalties are ultimately reported as income.

In a statement provided to The Verge, Facebook’s Berti Thomson said the company “stand[s] behind” the 2010 transaction, which it says occurred when the company had no mobile ad revenue, a “nascent” international business, and when its “digital advertising products were unproven.” Jay Peters/@verge

Source: verge, full story

 

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