November 4, 2009

Tax News

Sysco's Deal with the IRS

Restaurant food supplier Sysco Corp. has finalized a deal with the IRS over the agency's demands of taxes deferred by its subsidiary, Baugh Supply Chain Cooperative. Baugh is the subsidiary through which Sysco buys products for its business.

The dispute arose when Sysco contended that Bough's structure allows it to defer its tax payments under federal tax codes. But the IRS disagreed and audited the company's tax returns from 2003 to 2006. Under the audit, the IRS challenged the validity of Sysco's contention and proposed accelerated tax payments.

The agreement between Sysco and the IRS will see Sysco pay about $952 in deferred taxes and a further $41 million in interest payments over the next 3 years. The deal is for Sysco to pay $104 million by August 31st (which includes the $41 million prior interest charge), then another $212 by September 15th and $212 per year for 3 years starting from October 15th.

The company insists it has the funds to fulfill its obligations to make these payments over the next three years.

With the finalization of the agreement, Sysco said it expects a modest increase in its first quarter 2010 earnings of $30 million after tax income benefit or 5 cents per share due to interest already accrued.

YouTube and iTunes Feature the IRS

In its latest effort to communicate with the public, the IRS has embarked on novel ways of relaying tax-related information to taxpayers. It has started a YouTube site and an iTunes podcast channel. These new forms of media are filled with information about tax provisions under the American Recovery and Reinvestment Act (ARRA), one of the new laws under the government's economic stimulus package.

If you watch the YouTube videos, you will be shown how-videos and given tips about the stimulus law. Various topics under the ARRA are covered such as the first time home buyer's tax credit of $8,000, the tax deduction you are entitled to if you purchase a new car, motor home, motor bike or light truck, the expanded credits for higher education and energy saving related expenses on your home. There is even a video on how to use the IRS Withholding Calculator. The Calculator is especially needful for families where both spouses work. They need to ensure their withholding tax amount is just right, neither too much nor too little. The same also applies to people who hold more than one job.

On the other hand, the iTunes podcast is about the recovery law tax credits. The podcasts are also available in the IRS' website, www.irs.gov.

You can check out the IRS YouTube website at www.youtube.com/irsvideos and the iTunes site at http://itunes.apple.com/WebObjects/MZStore.woa/wa/viewPodcast?id=294852616.

Darrin T. Mish is a veteran, nationally recognized tax attorney who has focused on providing IRS help to taxpayers for over a decade. He regularly travels the country training other attorneys, CPAs and enrolled agents on how to handle their toughest cases with the IRS. He is highly ranked among the top attorneys in the country, with an AV rating from Martindale-Hubbell and a perfect 10 on Avvo.com. Martindale-Hubbell has also honored him with a listing in their Bar Register of Preeminent Lawyers. He is a member of the American Society of IRS Problem Solvers and the Tax Freedom Institute. With clients on every continent but Antarctica, he has what it takes to solve your IRS problems no matter where you live in the world. If you would like more information about his practice and how he can help you, please call his office at (813) 229-7100 or toll free at 1-888-GET-MISH.

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