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Nobody is secure from the IRS this tax season — and multi-billion greenback company Walgreens simply acquired a hefty audit from the federal government.
In line with a filing with the U.S. Securities and Trade Fee on February 29, Walgreens Boots Alliance was hit with a $2.7 billion invoice by the IRS after audits the company carried out allegedly discovered issues with Walgreens’ switch pricing between 2014 and 2017.
“The Firm intends to vigorously defend its place on the switch pricing matter via the IRS’s administrative appeals workplace and, if vital, judicial proceedings and is assured in its skill to prevail on the deserves,” the SEC submitting stated on behalf of Walgreens.
Walgreens Boots Alliance oversees Walgreens within the U.S. and Boots drugstores within the U.Okay.
“We imagine that we’ll prevail on the conclusion of the audit,” a spokesperson for Walgreens advised the Chicago Tribune.
Associated: Walgreens Unveils New CEO, $1 Billion Cost-Cutting Plan
In line with Investopedia, switch pricing is outlined as an “accounting apply that represents the worth that one division in an organization costs one other division for items and companies supplied,” which is usually used to assist decrease the general “tax burden of the dad or mum firm.”
The IRS is searching for further tax funds, curiosity, and penalties in its complete compensation from Walgreens.
The audit can take between two to seven years to finish, based on Bloomberg.
Associated: Walgreens Boots Alliance Exec Vice President: Raise My Taxes
Walgreens Boots Alliance joins different massive companies, together with Meta, Apple, and Microsoft which can be additionally dealing with IRS audits over switch pricing points.
Final fall, Walgreens unveiled a plan to cut back prices by $1 billion after reporting a weak fiscal 2023, which resulted in working losses of $6.9 billion for the yr as a consequence of opioid-related lawsuits and different litigation points.
Amid the losses, Walgreens is now unveiling an aggressive cost-cutting plan, together with closing 60 of its clinics, Axios reported.
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