Filed under: Government/Legal, Ford
FoMoCo sues feds for $445m in overpaid taxes
The idea of having Uncle Sam come after you for back taxes is an unpleasant thought for any American. It's another story altogether when the feds are the ones doling out the Benjamins, though, as Ford is learning. The Blue Oval is officially suing the government for $445 million in overpaid taxes between 1983 and 1989 and again from 1992 to 1994. Ford wasn't overly excited about filing a lawsuit against the IRS, but due to the overwhelming amount of money involved and the fact that Ford can use all the cash it can get its hands on, the company felt it had little choice. The government actually claims to have paid the money in full, but Ford contends that the interest was not fully repaid. Considering that the additional interest was nearly half a billion dollars, we're guessing Ford really overpaid back in the day. [Source: Detroit News]
Reader Comments (Page 1 of 1)
Gardiner Westbound 12:49PM (7/12/2008)
Good luck with that one.
Ford must have been swimming in cash in the 1980s to overlook a half billion dollar interest shortfall. If the CFO is still around he should be packing.
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Tai 12:51PM (7/12/2008)
Condering the IRS would compound the interest daily if we were to owe them money, I would hope Ford really sticks it to them.
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Red 1:15PM (7/12/2008)
Uh, yeah....definitely wanna get that back.
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2004m3driver 1:23PM (7/12/2008)
Then they could put that money into developing next generation fuel miser cars. Which would help the economy, which would raise income, which means the IRS gets to collect more taxes. Everyone wins!!
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John 1:45PM (7/12/2008)
This seems really far fetched. Ford seems desperate to generate cash in any possible way.
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AMGoff 2:00PM (7/12/2008)
How is that far-fetched?
If the IRS owed you money... especially half a billion dollars, wouldn't you want that back as well?
Disgruntled Goat 7:48PM (7/12/2008)
Seems like a piece of cake to me. The taxpayers in Mass owed the IRS a third of a billion $$$ (http://www.autoblog.com/2008/07/12/class-warfare-exotic-car-owners-in-ma-got-massive-tax-break/) and they said "nah, it's not worth the hassle of trying to collect it." I'm sure the IRS will cut Ford a check tomorrow instead of hassling with them over that legal mumbo jumbo headache.
John 8:40PM (7/12/2008)
If Ford is really this stupid and didn't notice hundreds of millions of dollars in overpayments, they deserve to be out of business.
Jobu37 2:02PM (7/12/2008)
John is probably right. Ford probably didn't even run a second tape to verify the final amount. They figure that the best way to work through the current crisis is to make an unsubstantiated claim against the government.(sarcasm)
I'm pretty sure they have checked everything nine ways to Sunday before publicly announcing that they want their money back.
Gardiner, it just so happens that Ford was the most profiable automaker in world back in the late 80's. They were the first to break the $5 billion profit in one quarter threshhold. So yes they were swimmng in cash and could have easily overpaid their taxes. It was at this time that they made the mistake of buying Jaguar. I guess that money was just burning a hole in their pockets.
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Johnny 3:53PM (7/12/2008)
Thats true Ford was profitable upto 5 years ago.
Just over the last 10-15 years, Ford had the best selling Truck in F150 no longer the case as GM outsells them now, Had the best selling Car in Taurus, Camry is it now, Had the best selling compact in Focus in 2000-2002, civic is number one now, had the best selling small pickup in Ranger, Tacoma now, best selling SUV in explorer, CRV now, best selling full size econoline van, by a slight margin GM has it now, had the second best selling minivan in 96-99, doesnt even have a minivan anymore.
Anyways, every single one of those except the F-150 was left to rot on the vine. I dont know why F150 got so much attention when the taurus,ranger,explorer,econoline,focus and windstar did not.
Disgruntled Goat 7:54PM (7/12/2008)
True, but if it's any consolation I'm sure the execs at Ford up to and including the CEO were quickly fired and stripped of their golden parachutes for such poor leadership. They're all about pay for performance you know.
paul34 2:26PM (7/12/2008)
Fight the IRS, Ford - I've got your back! Well, I guess not really since I am too poor to afford corporate lawyers.
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tankd0g 2:54PM (7/12/2008)
Accounting firm's bill to find that mistake: $444 million.
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Jonathon 4:11PM (7/12/2008)
Making sure your Government pays up money they probably would have given to you in your hour of need (before you pissed them off), Priceless.
tankd0g 4:34PM (7/12/2008)
You can have it back, but you have to pick it up yourself. It's currently in an unmarked truck parked in front of the Green Zone Convention Center, Baghdad, Iraq.
Randy 6:30PM (7/12/2008)
"Making sure your Government pays up money they probably would have given to you in your hour of need (before you pissed them off), Priceless."
Bush already said he had no intention of helping! Unless of course your country harbors terrorists. Then he'll spend the tax payers money to protect you! Otherwise............
Red 8:09PM (7/12/2008)
Bush would do well to help Chrysler. The least fuel efficient line-up in America equals more money in the hands of his oil buddies. It's a win-win for everybody.
Well, except maybe Chrysler and the American people. But hey, he's gotten us this far. Go all the way!!
(to hell that is)
Harrison 4:21PM (7/12/2008)
Screw IRS - live axle FTW! :D
Sorry, I couldn't resist.
But Ford, if they win, will gain some serious cash. I just hope our taxes won't go up as a result.
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J.A. 12:02PM (7/14/2008)
If Ford gets so much money back from our government, they will be denying many young Americans the chance to pursue a military career in Iraq. It might also help keep the company from going bankrupt!!!
Oh, no!!! Bush, you have to stop this!!!!! You can't rest until every last job is driven away from Michigan!!!
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subaru07 1:37PM (7/14/2008)
According to a family member of mine who is a lawyer for Ford, Ford paid $800 million in excessive taxes. The government refunded them the money, but Ford is now suing for the interest on that money during the time period that the government had its hands on it.
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