Ford sues the IRS. . .

Posted by Bruce Mc on Jul 14, 2008 in News Flash, Opinions, Taxes | 0 comments

“Good grief Charlie Brown!” I can hear Lucy saying as she hears the news.

            Okay in case you haven’t heard, Ford is suing the IRS for failing to remit $445,292,207 in interest on tax overpayments for 1983 to 1989, 1992 and 1994. A tax refund. That is almost one half of a billion dollars. That is a significant amount of money for Ford, which has lost a combined $15.3 billion over the past two years and also expects to post significant losses this year because of plummeting sales of profitable trucks.

Now the issue isn’t that the IRS owes the money to Ford motor company, but the dispute seems to be in how the IRS calculates the amount due the motor giant. The IRS concedes they owe Ford; however, the dispute at hand involves a disagreement about how the interest owed should be calculated and how much interest Ford is actually owed.

“The IRS’ calculation of … overpayment interest is not a simple matter of taking the tax underpayment … and computing interest on that amount,” the lawsuit says. “Rather, the IRS recomputes the taxpayer’s account for the specific tax year by sorting all of the transactions in order of the dates they are deemed to be effective and computing interest on the account balance as it is affected from transaction to transaction.”

            Ford spokeswoman Marcey Evans told the Detroit News, “We tried to resolve it at the administrative level without success. Because of the size of the amount and the dispute, we had no choice but to file.”

            Hummm. . .