IRS hits Nortel with $3-billion tax claim

Posted 3433 days ago by god in category Ottawa TechWatch with 0 Comments 

U.S. agency targets company's dwindling assets

By James Bagnall and Bert Hill, The Ottawa Citizen

The U.S. tax authorities have thrown a huge curve ball at Nortel creditors by submitting a $3-billion U.S. claim for back taxes, interest and other penalties.

If U.S. bankruptcy judge Kevin Gross accepts all or most of the claim as valid, "it will deplete whatever is available to other creditors," says Tony Marsh, the spokesman for Nortel retirees. "That's a pretty scary number."

If Nortel completes the sale of its global assets as planned, it is expected to have little more than $5 billion (all figures U.S.) in cash to distribute. This is to be applied against more than $10 billion worth of claims arising from creditors in Canada, the U.S., Britain and many other jurisdictions. Claimants -- from company suppliers to pensioners -- would receive roughly 50 cents on the dollar.
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