Submitted by mike on January 1st, 2016
In this NY Times article entitled “Tax Deductions Blunt Impact of Large Corporate Settlements, Report Says” Liz Moyer points out that:
“Corporations continue to use big civil legal settlements with federal regulators as a way to deduct billions of dollars from their American tax bills, largely because the regulators fail to forbid the practice in the terms of the settlements.”
For example the $20.8 billion dollar settlement from the BP oil spill had $15.3 billion identified as tax deductible. Her article takes a look at the 10 biggest settlements by five federal regulators since 2010 and found that of $80 billion in settlements, $48 billion was tax deductible resulting in $17 billion in savings to the firms picked up by U.S. taxpayers. She also points out this is more than all of the estate and gift taxes combined.
I found this to be an interesting read and thought you may too.
About the author
Mike Gregory is a professional speaker, an author, and a mediator. You may contact Mike directly at mg@mikegreg.com and at (651) 633-5311. Mike has written 12 books (and co-authored two others) including his latest book, The Collaboration Effect: Overcoming Your Conflicts, and The Servant Manager, Business Valuations and the IRS, and Peaceful Resolutions that you may find helpful. [Michael Gregory, ASA, CVA, MBA, Qualified Mediator with the Minnesota Supreme Court]
