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Microsoft SEC 8-K: IRS is seeking an additional tax payment of $29B

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Re: Microsoft SEC 8-K: IRS is seeking an additional tax payment of $29B

#271

Post by nerdkid93 »

kllrnohj wrote: post #242
smorrebrod wrote: post #233

Earlier quoted context omitted.

This sounds to me like an gigantic amount of money. I looked it up and apparently it was $136B in 2019¹ and $111B today². And Microsoft, although it is the company with the most cash on hand, is not an outlier here with Alphabet at $121B and Apple at $100B². I really don't know why they do this though. [1] https://www.cnbc.com/2019/11/07/microsoft-apple-and-alphabet... [2] https://www.macrotrends.net/stocks/charts/MS…

> I really don't know why they do this though. Because you're looking at absolute numbers and not percentages/relative values. That much cash on hand sounds absurd when you're only looking at the absolute number of it, but the amount it represents is "just" 6 months of revenue. And any good financial advisor will tell you it's a good idea to keep 6 months of earnings as savings.

A good financial advisor will recommend keeping 3-6 months of non-negotiable expenses saved, not revenue. 6 months of revenue would be a quite significant amount of savings for most people.

Re: Microsoft SEC 8-K: IRS is seeking an additional tax payment of $29B

#272

Post by takinola »

smorrebrod wrote: post #233
Crosseye_Jack wrote: post #171

Earlier quoted context omitted.

Well even if MS are found to be liable for this tax bill, MS has in the region of $100 billion "Cash on hand" so I doubt that they will go bankrupt over this.

This sounds to me like an gigantic amount of money. I looked it up and apparently it was $136B in 2019¹ and $111B today². And Microsoft, although it is the company with the most cash on hand, is not an outlier here with Alphabet at $121B and Apple at $100B². I really don't know why they do this though. [1] https://www.cnbc.com/2019/11/07/microsoft-apple-and-alphabet... [2] https://www.macrotrends.net/stocks/charts/MS…

It is mostly about taxation. Companies get taxed where the money is made/moved. A lot of the money in big company balance sheets is in Europe where they have lower corporate tax rates. If they moved that money back to the US, they would have to pay more tax on it. However, they have less need for the money outside the US, so the money just piles up.

Note, this is a very simplistic explanation of complex global accounting regulations (eg the money is likely "physically" in New York even though it is "legally" in Europe)

Re: Microsoft SEC 8-K: IRS is seeking an additional tax payment of $29B

#273

Post by spiralpolitik »

Crosseye_Jack wrote: post #171
test77777 wrote: post #136

When was the last time a major corporation went bankrupt for failing to pay its taxes?

Well even if MS are found to be liable for this tax bill, MS has in the region of $100 billion "Cash on hand" so I doubt that they will go bankrupt over this.

The problem MS might run into is that cash might not be in the US so they would need to repatriate the money into the US potentially triggering more taxes.

(They could also get around this by taking a loan out and using the cash held outside the US as collateral).

Re: Microsoft SEC 8-K: IRS is seeking an additional tax payment of $29B

#274

Post by kergonath »

jimbob21 wrote: post #204
dragontamer wrote: post #197

Earlier quoted context omitted.

> but iirc he could still have pulled out by paying "only" a couple billion dollars in fines or something. That clause was clearly for things outside of Elon (or former Twitter)'s control. Like if a government stepped in to stop the purchase. Elon never had a good counter argument. So it was simply a case of those who were able to read the public court documents vs the ones who believed Elons out-of-court media blitz…

[flagged]

Apart from the last paragraph, it’s a good debunking of that tired “he could have pulled out just by paying 1B$” meme. He could not, and this has been explained in quite a lot of detail on every public forum I have seen at the time.

“My man” itself is also obnoxious and condescending.

Re: Microsoft SEC 8-K: IRS is seeking an additional tax payment of $29B

#275

Post by cma »

littlestymaar wrote: post #165
blitzar wrote: post #163

Earlier quoted context omitted.

+ 10 years of interest and penalties, compounding.

From the article: > Microsoft owes the Internal Revenue Service (IRS) $28.9 billion in back taxes, not including penalties and interest

There was close to a zero interest rate during all that time, or does IRS use something way above normal for their rate?

Re: Microsoft SEC 8-K: IRS is seeking an additional tax payment of $29B

#276

Post by badwolf »

s_dev wrote: post #267
JKCalhoun wrote: post #254

Earlier quoted context omitted.

Is this basically the Double Irish With a Dutch Sandwich?

Double Irish isn't possible as of 2018: https://en.wikipedia.org/wiki/Double_Irish_arrangement

This is for the time period 2004-2013

Re: Microsoft SEC 8-K: IRS is seeking an additional tax payment of $29B

#277

Post by badwolf »

iagooar wrote: post #237
uxp8u61q wrote: post #187

No message about how greedy Europe wants to steal money from big tech, yada yada yada. Oh, it's the USA this time? Wait, does this mean that these big tech were really not paying their fair share and the USA was just slow to get caught to it? I guess so.

What is a "fair share" in your opinion?

At this moment, I'd estimate a fair share being approximately $29 billion.

Re: Microsoft SEC 8-K: IRS is seeking an additional tax payment of $29B

#278

Post by mrguyorama »

piuantiderp wrote: post #261
dbg31415 wrote: post #260

It feels like if we just made these big companies pay what they should in taxes we'd be able to take some big steps towards health care, better schools, improving our crumbling infrastructure...

Nah, most problems are on the spending side, collection is fairly good...

Actually, according to the IRS themselves in their yearly report to congress, they yet again have not been given the resources to go after big companies or rich individuals who are clearly skirting tax laws (and which will inevitably cause a serious court case because fuck you for trying to collect taxes from anyone with a lawyer) so they are basically relegated to sending mean letters to average and poor people for a few hundred dollars here and there, and they STILL collect more money than they are given in funding.

The IRS has been begging for the resources to go after big baddies for decades, but the Feds have been gun-shy at going after any large company since Enron.

Re: Microsoft SEC 8-K: IRS is seeking an additional tax payment of $29B

#279

Post by nkozyra »

cma wrote: post #275
littlestymaar wrote: post #165

Earlier quoted context omitted.

From the article: > Microsoft owes the Internal Revenue Service (IRS) $28.9 billion in back taxes, not including penalties and interest

There was close to a zero interest rate during all that time, or does IRS use something way above normal for their rate?

Back taxes have a baseline rate that grows at certain increments of lateness but is ultimately capped. I don't think it's in any way tied to the base or prime rate.

Re: Microsoft SEC 8-K: IRS is seeking an additional tax payment of $29B

#280

Post by jraby3 »

user_7832 wrote: post #264
JKCalhoun wrote: post #254

Earlier quoted context omitted.

Is this basically the Double Irish With a Dutch Sandwich?

A Dutch Sandwich sounds like two dry pieces of bread with a thin slice of cheese. I'd discourage MS from getting one.

After having just spent a month in Utrecht you are 100% right. Your comment made me smile.
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