America’s largest companies need to dig into their uncertain tax positions and contemplate how those items will look to a tax auditor on an itemized listing.
The Internal Revenue Service has finalized its new “Schedule UTP” for corporate taxpayers, which requires companies to rank and describe tax positions for which the company has set aside reserves in the financial statements. A tax reserve is a red flag to the IRS that the company isn’t entirely confident that its tax position will hold up under audit scrutiny or litigation, so the company sets aside some extra cash in case it must pay more tax.
