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IRS Is Suing Facebook Over Asset Transfers In Ireland (fortune.com)
An anonymous reader quotes a report from Fortune: The Internal Revenue Service (IRS) has sued Facebook on Wednesday to force it to comply with summonses related to a 2010 asset transfer. Fortune reports: "According to documents the IRS filed in San Francisco federal court, the agency suspects Facebook and its accounting firm, Ernst and Young, understated the value of intangible assets transferred to Ireland by billions of dollars. The IRS says it is seeking an order to enforce six summonses that asked Facebook to appear at the agency's offices in San Jose, Calif., and to produce papers and others records. According to IRS agent Nina Stone, Facebook failed to show up at the appointed date of June 17, and nor did it provide the documents. The dispute arose as a result of an ongoing audit of Facebook by IRS that stretches back to 2010. In that year, the company chose to designate Facebook Ireland as the rights-holder for its worldwide business outside of the U.S. and Canada, and also to transfer intellectual property assets such as its platform and 'marketing intangibles.' The crux of the disagreement between Facebook and the IRS turns on the arcane question of whether the assets in question could be transferred in their entirety or if, as the agency argues, they are 'interdependent.' [The agent's declaration can be found here.] Such arrangements are common among U.S. tech companies, and seek to reduce tax payments by scoring revenue in low tax jurisdictions like Ireland, while having higher tax countries (especially the U.S.) reduce profits by paying to license intellectual property from overseas subsidiaries."
If any of us common people failed to show up or provide documentation we would be liable for whatever the IRS claims we owed. Nice to see the double standard isn't just for Hillary.
This seems to be a case of Facebook going one step too far (and they deserve to be hunted down for it), however current laws mean for the most part their fair share is SFA or Zero. tax laws need to change, lower corporate laws with harsher and stricter rules for moving assets offshore would help to fix this. It is far better to get 10% of billions than 30% of nothing.