Facebook US tax lawsuit

The US Department of Justice has gone to court in California to force Facebook to open up to Uncle Sam's taxmen about its tax dealings.

The Internal Revenue Service is examining Facebook's accounts from 2010 – in particular the firm's practice of funneling funds from their worldwide holdings (except in the US and Canada) through a company called Facebook Ireland Holdings. The tax agency issued six IRS summonses for Facebook to meet officials on June 17, but the web giant failed to comply.

The IRS is already investigating Facebook's accounts for 2008 and 2009, but launched a review into the 2010 filings back in January 2013. IRS agent Nina Stone is particularly interested in examining the valuations on the firm's intellectual property set by the accountancy firm Ernst and Young, which the court documents state could be understated by billions of dollars. ®

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