IRS hits Symantec with $1B tax bill

The company allegedly underreported the value of intellectual property

By Robert McMillan

April 18, 2006 12:00 PM ET

Recommended

IDG News Service - The U.S. Internal Revenue Service has hit Symantec Corp. with a $1 billion tax bill for allegedly underreporting the value of intellectual property that the software vendor transferred to two Irish subsidiaries.

Symantec was notified of the issue by the IRS in late March, the company said in a regulatory filing dated yesterday.

The IRS claims that both Symantec and Veritas Software Corp. underpriced intellectual property that the two companies licensed to their Irish subsidiaries, said Symantec spokeswoman Genevieve Haldeman. Both Symantec and Veritas, which was purchased by Symantec in 2005, set up the Irish subsidiaries for the purpose of doing business outside of the U.S., she said.

The IRS believes that Symantec owes about $900 million, excluding penalties and interest, in connection with the Veritas claim, which covers the 2000 and 2001 Veritas tax returns. Another $100 million is due in connection with Symantec's fiscal 2003 and 2004 reports.

Symantec does not agree with the IRS's position and plans to appeal the tax assessment, Haldeman said.

Symantec's stock (SYMC) dropped more than 4% following the news and was trading at $15.73 in after-hours trading on the Nasdaq Stock Market's INET exchange.

Reprinted with permission from

IDG.net
Story copyright 2009 International Data Group. All rights reserved.

Recommend Digg Twitter ShareThis

Email Print Send Feedback Reprints

Jump to comments

Legislation/Regulation

Additional Resources

WHITE PAPER

Do You Know the 7 Steps to Successful Data Migration?

Approximately 60 percent of data migration projects overrun time or budget, while some fail completely. Download this white paper, "Enhancing Your Chance for Successful Data Migration," to learn the critical steps you need to take to execute a data migration project with minimum cost and risk to your business.

WHITE PAPER

Total Cost of Ownership of Server Computing Vs. PCs

Read the Gartner research note to learn why the TCO of a server-based computing deployment used to deliver all applications to users is around 50% lower than that of an unmanaged desktop deployment.

WHITE PAPER

IDC White Paper: Linux in a Global Recession

Economic downturns have a tendency to accelerate emerging technologies, boost the adoption of effective solutions, and punish solutions that are not cost competitive or that are out of synch with industry trends. This IDC White Paper presents the results of an IDC survey of 330 companies in Western Europe, Asia/Pacific and the Americas that measures the receptiveness to Linux and takes into consideration changing views driven by the disruptive economic environment that businesses face today.

White Papers & Webcasts

Informatica 9 Launch: Transform your Business. Transform your world.

LIVE Nov 10, 2009 12:00 PM ET

Architecting Business Intelligence Applications for Change: The Open Solution

LIVE Nov 12, 2009 02:00 PM ET

Forrester Consulting - Optimizing Users and Applications in a Mobile World
Learn how to successfully deploy a WAN optimization solution that is specifically tuned for a mobile environment!

Top to Bottom Performance Management Excellence at the City of Chicago
View now.

Faster, Cheaper and Easier to Maintain
Can you afford not to upgrade your servers to today's advanced, energy-efficient technologies?

Effectively Implementing Datacenter Automation
Effectively select and deploy the best datacenter automation solution today!

The State of PCI DSS Compliance at Organizations Today
Download this resource today!

Aligning IT to Business: The Rising Importance of Application Delivery Networks
Application Delivery Networking (ADN) will play a vital role in helping enterprises incorporate strategic technologies to achieve business initiatives.

IDC Research Report: The Business Value of Consolidating on Energy-Efficient Servers
Download this Resource Now!

Strategies for Driving Down IT Support Costs with Lite ITIL Practices
View this now!

HP Technology Guide for Scalable Business Solutions
Download This Resource Now!

Mitigate Risk, Lower Costs and Improve Network Efficiency
Create a stable IP network that not only meets today's challenges, but is flexible enough to also meet future demands.

All White Papers | All Webcasts