Coca-Cola: IRS says we owe $3.3 billion in back taxes

Coca-Cola or Coke tile
Coca-Cola or Coke tile

NEW YORK -- Coca-Cola was notified by the IRS that it owes $3.3 billion more in federal taxes, as well as interest, for 2007 to 2009, the company said Friday.

The Atlanta-based company said in a regulatory filing that it believes the assessments are without merit and plans to pursue "all administrative and judicial remedies necessary to resolve the matter."

The maker of Sprite, Dasani, Powerade and other drinks says the disagreement is over how much of the money it makes from licensing products overseas should be considered be considered taxable income in the U.S. The company says it has been following the same methodology for determining its taxable U.S. income for nearly 30 years.

"The IRS now seeks to depart from this long-standing practice in order to increase substantially the amount of tax," the company said in a statement. "We are among hundreds of other companies currently facing these types of adjustments involving payments."

Coca-Cola Co. says it was notified that a recommendation has been made to the IRS's chief counsel that the matter be designated for litigation. The company plans to start disputing the matter by filing a petition in U.S. Tax Court.

It said the IRS made the determination on owed taxes after a five-year audit.

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