Wall Street Journal: AIG-HP Tax Deal Challenged by IRS, by Jesse Drucker:
The dispute centers on yet another offshore tax-cutting deal set up by the AIG unit at the heart of the executive-bonus controversy.
The IRS is challenging the taxes saved by AIG through a series of offshore transactions entered into with several banks, including Crédit Agricole SA of France, Bank of Ireland and Bank of America Corp., according to an AIG lawsuit. AIG paid $61 million in disputed taxes and sued the U.S. government in federal court for a refund.
But a transaction sold to Hewlett-Packard shows that AIG's tax-cutting deals spread beyond the financial sector, filings in a case in U.S. Tax Court show. According to a person familiar with the business, AIG's tax-structuring operation was even bigger than the credit-default-swaps business that led to the company's meltdown.
