In the agreement on a tax return, American International Group Inc. has agreed to allow more than $ 400 million in tax breaks and to impose a 10% tax penalty for allegedly entering into sham transactions designed to generate counterfeit foreign tax credits, it said. U.S. Attorney's Office for the Southern District of New York on Friday.
Acting U.S. Attorney Audrey Strauss said in a statement that the settlement involves seven cross-border financial transactions that U.S. prosecutors claimed were infringing tax protections designed to generate false tax breaks. that AIG was wrongly trying to use it to reduce its US tax debt.
US law firm said AIG had filed a tax refund process in 2009, with the aim of recovering unauthorized foreign tax credits and other taxes related to the tax year 1
However, the US received overwhelming evidence that these transactions lacked any meaningful economic substance, lacked legitimate business purposes, and instead only designed to produce hundreds of millions of dollars in tax benefits to which it was not entitled, the statement said. York On Thursday, AIG approved all foreign tax breaks they had claimed for the 1997 tax year and all subsequent tax years for the same transactions, totaling more than $ 400 million, would be allowed in full. It also agreed to pay a tax of 10%, according to the statement.
Ms. Strauss said in the statement that AIG had "created a comprehensive series of fraudulent transactions designed to do nothing – and in fact did nothing but generate hundreds of millions of dollars in bad tax benefits for AIG."
An AIG spokesman said in a statement, "Having already reached and revealed our January 2018 agreement in principle on these transactions from the 1990s, we are pleased to put this long-standing issue behind us." Catalog