Every year, thousands of the nation’s largest corporations are required to report to the I.R.S. whether they have reduced their tax bills by using questionable accounting strategies.
They have to supply an estimate of how much they might owe if those strategies failed to withstand an audit.
They even have to set aside enough money to pay the government if their claims are found to be improper.
But the corporations are not obliged to reveal precisely what those uncertain tax positions are — and if the I.R.S. does not manage to ferret them out and challenge them before the three-year statute of limitations expires, the companies can keep the money.
Now, the Internal Revenue Service is calling an end to the game. Beginning next year, the agency plans to mandate that corporations also provide a brief description of their uncertain tax positions and their rationale, offering essentially a road map for its auditors. continue reading