A federal judge yesterday found for Medtronic (NYSE:MDT) in its lawsuit against the IRS over a $1.36 billion tax bill.
The dispute involves “transfer pricing” among the company’s various units during the tax years 2005 and 2006. The tax bureau claimed Medtronic owed income tax of $548.2 million for 2005 and $810.3 million for 2006; the Fridley, Minn.-based company disputed the bill and took the case to the U.S. Tax Court.
Yesterday Judge Kathleen Kerrigan found that Medtronic proved that the IRS was “arbitrary, capricious, or unreasonable” in its interpretation of the transfer pricing for its Puerto Rico subsidiary.
The dispute involves “transfer pricing” among the company’s various units during the tax years 2005 and 2006. The tax bureau claimed Medtronic owed income tax of $548.2 million for 2005 and $810.3 million for 2006; the Fridley, Minn.-based company disputed the bill and took the case to the U.S. Tax Court.
Yesterday Judge Kathleen Kerrigan found that Medtronic proved that the IRS was “arbitrary, capricious, or unreasonable” in its interpretation of the transfer pricing for its Puerto Rico subsidiary.
