[quote=CNN]General Electric filed more than 7,000 income tax returns in hundreds of global jurisdictions last year, but when push came to shove, the company owed the U.S. government a whopping bill of $0.
How'd it pull off that trick? By losing lots of money.
GE had plenty of earnings last year -- just not in the United States. For tax purposes, the company's U.S. operations lost $408 million, while its international businesses netted a $10.8 billion profit.
That left GE (GE, Fortune 500) with no U.S. profit left for Uncle Sam to tax. Corporations typically face a 35% federal income tax on their earnings. Thanks to its deductions and adjustments, GE reported an actual U.S. federal income tax rate of negative 10.5%. It got to add a "tax benefit" of $1.1 billion back into its reported earnings.
"This is the first time in at least decades that GE has reported negative U.S. pretax income and it reflects the worst economy since the Great Depression," Anne Eisele, GE's director of financial communications, said via e-mail.
But what about the $10.8 billion profit overseas? GE is "indefinitely" deferring income tax payments on those profits, Eisele said.
It may seem like accounting magic, but it's completely legit.
GE isn't the only "Top 5" company on this year's Fortune 500 list that owed no income taxes. Bank of America (BAC, Fortune 500), which suffered major losses in 2009, included a tax benefit of $1.9 billion in its annual profit.
"That's one way of escaping taxes," said Scott Hodge, president of the Tax Foundation. "Companies get to deduct their losses, so if there's no earnings, then they pay no income tax."
But GE isn't exactly escaping all tax-related pain: The company paid almost $23 billion in taxes to governments around the world from 2000 to 2009, Eisele said.
Plus, paying the accountants to crank out 7,000 tax returns can't be cheap.
And then there's all the lawyers needed to defend those returns. GE filed tax paperwork in more than 250 jurisdictions around the world last year. "We are under examination or engaged in tax litigation in many of these jurisdictions," the company dryly notes in its annual report.
GE may not owe the IRS, but it still has to file -- and its filings are epic.
In 2006, as the IRS ramped up its corporate e-filing program, the tax agency actually issued a celebratory press release when it processed GE's tax return. On paper, the return -- the nation's largest -- would have totaled a massive 24,000 pages. But instead, the IRS was able to upload the 237 MB document in under an hour.
Reading it, though, is apparently taking a bit longer. The IRS is currently auditing GE's tax returns for 2003-2007.[/quote]
source: [url]http://money.cnn.com/2010/04/16/news/companies/ge_7000_tax_returns/index.htm[/url]
VGPU News Comment:N/A
ok
Damn tax shelters.
Whoop-de-doo, major corporations are finding ways to avoid paying/not have to pay taxes...
What isn't new?
[QUOTE=Musicfreak59;21409499]Whoop-de-doo, major corporations are finding ways to avoid paying/not have to pay taxes...
What isn't new?[/QUOTE]
No shit. Imagine the dent we could put in the deficit if individual companies like GE and Exxon-Mobile weren't dodging billions of dollars apiece in taxes they rightfully should be paying every year.
I'm getting a Tea Party ad at the bottom of the page, haha.
I wonder how they'd react if they realized many big corps pay no US taxes.
Takes Billions of our Tax Dollars, Piss it away at strip clubs, vacations and bonuses, and then don't even have to pay taxes themselves
I fucking hate this shit
lol, ironic.
Fox News did a whole story on this saying low-class people don't pay taxes, how that's unamerican, and destroying our economy.
This kind of shit happens, Exon Mobiles never pays any taxes, they do a 3 second shit saying 'Exxon Mobile hasn't paid many taxes', then goes to a story talking about a spa.
[QUOTE=lolwutdude;21411068]
Fox News did a whole story on this saying low-class people don't pay taxes, how that's unamerican, and destroying our economy.
[/QUOTE]
I can guarantee you this will be on Fox News. And it probably won't just be some small story.
[url]http://news.yahoo.com/s/ynews/20100414/ts_ynews/ynews_ts1611[/url]
way bottom
jon stewart busting balls
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