Symantec settles one issue with the IRS

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Symantec has agreed in principle to pay the Internal Revenue Service (IRS) $36 million to settle an outstanding tax obligation resulting from an audit of anti-virus giant’s finances.

The settlement, down from the IRS’ original assessment of about $100 million, concerns an audit of Symantec’s 2003 and 2004 fiscal years related to transfer pricing between the company and an unnamed foreign subsidiary, according to a company statement.

The IRS hit Symantec with an "incremental tax liability" notice on April 17, the statement said. The settlement should be completed by the end of this month and reflected on the firm’s June quarter balance sheet.

Still unresolved is another matter in which the IRS claims Symantec owes it up to $1 billion in income taxes as a result of the company’s acquisition last year of storage management vendor Veritas. Symantec is appealing in U.S Tax Court.

The bill is for allegedly unpaid taxes as a result of Symantec’s July 2005 acquisition of Veritas for $10.5 billion. The two companies allegedly under-reported the value of a technology license agreement transferred to two Irish subsidiaries set up to sell company products.

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