The IRS needs whistleblowers now more than ever.  A recently released study by the Citizens for Tax Justice and the Institute on Taxation and Economic Policy examined 280 of the current Fortune 500 and found a general pattern of decreasing tax rates, with 78 of those taxpayers paying no tax at all in one of the last three years.   This study was picked up by some of the mainstream media [including The New York Times, 280 Big Public Firms Paid Little U.S. Tax, Study Says; Bloomberg, Thirty Top Companies Profited Without Paying Tax, Study Finds; and The Washington Post, Study: Big corporations use loopholes, dodge taxes], and we think they are in the right to be alarmed. 

Our annual Ferraro 500 list of corporate tax shenanigans [see our list from last year] shows a similar pattern of potential corporate malfeasance, but we focus on reserves for Uncertain Tax Positions, which are monies set aside to cover issues that the taxpayers themselves think they should lose if the IRS challenges them.  We believe that studies like this, which are based on audited financials of the country’s largest taxpayers, show the IRS, Congress, and U.S. taxpayers where they should focus their energies in corporate tax compliance.  Where there is smoke there is usually fire.

Lynam Knott