Facebook could be liable to pay between $3 to $5bn in extra US tax after an extensive investigation by the US Internal Revenue Service (IRS) into the way the tech company transferred assets to Ireland.
The tax agency has been exploring whether Facebook deliberately deployed complex financial processes designed to minimize the amount of US tax it paid.
The IRS issued the firm with a “statutory notice of deficiency” on 27 July, the company said in its quarterly financial filing, noting that it could have a “material adverse impact” on its finances. Facebook broke out the possible loss in its earnings report, as a minimum of $3bn and maximum of $5bn. It would also be liable for interest lost, though any additional penalties are not known.
On Friday, a Facebook spokesperson said in a statement: “Facebook complies with all applicable rules and regulations in the countries where we operate.”
Read more at The Guardian.