Faced with a $3-billion tax billion from the U.S. Internal Revenue Agency, Nortel (NRTLQ.PK) has been told that it must prepare for a court date on Oct. 13 – yet another reason for Nortel’s lawyers to pick up some more fees.
According to Bloomberg News, U.S. Bankruptcy Judge Kevin Gross has ordered the two two sides to meet tomorrow to talk about the information they need to exchange the trial.
Nortel claims it doesn’t owe the IRS anything because there “is no reasonable or realistic basis for the IRS claim”.
“The IRS overstates the amount of income of the NNI Filing Group that could be subject to US federal income tax, and thus erroneously asserts a claim for income tax due,” Nortel said in U.S. Bankruptcy Court for the District of Delaware.
Nortel said it had no cash tax liability for the 1998 to 2007 taxable periods, aside from $6 million cash tax paid for alternative minimum tax liability, adding that the IRS paid Nortel a $717 million refund in 2002 that Nortel had paid in income taxes for 1998, 1999 and 2000
Nortel also said in the filing it had a net taxable loss of more than $3.6 billion from 1998 to 2000, and nearly $5.6 billion in 2001 and 2002.
