- In an SEC filing, Caterpillar Inc CAT unveiled the settlement with the US Internal Revenue Service (IRS), which resolves all issues for 2007 through 2016 with no penalties.
- The company’s settlement involves resolving the disputed tax treatment of gains made by its Swiss subsidiary, Caterpillar SARL, from certain parts businesses.
- “We have vigorously contested the IRS’s use of substance-over-form or assignment-of-income legal doctrines and proposed tax increases and the imposition of accuracy penalties,” the company said.
- Related: Caterpillar shares slide on lack of second-quarter earnings; Registered 11% sales growth.
- The settlement includes no US tax increases based on these doctrines and no penalties. The settlement is within the total amount of unrecognized gross tax benefits for uncertain tax positions, thereby avoiding the cost and burden of further litigation with the IRS.
- Analysts had estimated that Caterpillar faced potential tax hikes and penalties from the IRS that could total more than $2 billion. Wall Journal reports.
- Price promotion: CAT shares are up 1.28% to $185.50 during the premarket session last Check Friday.
- Photo via Wikimedia Commons
© 2022 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Read full story here https://www.benzinga.com/news/large-cap/22/09/28807931/caterpillar-to-pay-no-penalties-as-settlement-of-tax-dispute
