Saturday, November 25, 2023
CVS has sued the US of America for greater than $400 million
CVS Well being is suing the US of America — in a dispute over greater than $400 million that the Woonsocket-based mega-retailer believes it deserves over the deduction of home “manufacturing.”
The entire quantity in dispute over the 4 years is $402,525,068.
The lawsuit claims that the IRS has denied sure deductions for tax years 2014 to 2017.
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The 15-page lawsuit was filed this week in federal courtroom in Rhode Island.
Mega-Swimsuit Gamers
Representing CVS is Eversheds Sutherland — “a world high 10 regulation follow” with 70 places of work — along with native counsel, former U.S. Lawyer Robert Corrente.
Corrente has been within the information for his function within the high-stakes Chace v. Chace household lawsuit.
CVS can be asking for the courts to award “its prices, together with lawyer’s charges, and such different and additional reduction as this Courtroom deems simply and correct.”
For CVS, it’s simply the newest large information popping out of Woonsocket.
Final November, CVS introduced that it was agreeing to pay $5 billion in a settlement for the corporate’s function within the distribution of opioids.
In August of 2023, CVS introduced the layoff of greater than 5,000 workers.
And, the corporate’s inventory has lagged.
Lawyer Robert Corrente PHOTO: File
The Battle
CVS claims that sure prices — prices associated to the home productions for printing photographs, manufacturing of sure prescribed drugs, manufacturing of blister packs, and manufacturing of software program merchandise — have been deductible beneath the Home Manufacturing Actions Deduction beneath the tax code.
And CVS claims that it filed the deduction in a well timed modification, stating, ” On January 15, 2021, CVS Well being well timed filed an amended federal revenue tax return, Type 1120X, for its tax yr ended December 31, 2014, claiming a deduction beneath Part 199 for its home manufacturing actions.”
However the IRS shot down CVS’ amended claims.
“On December 8, 2022, the IRS denied CVS Well being’s declare for refund for its 2014 tax yr, stating that CVS Well being didn’t qualify for the Home Manufacturing Actions Deduction,” states CVS’ swimsuit.
PHOTO: Laura Fuhrman, Unsplash
Printing Footage, Passport Images, and Collections on DVDs
One of many central areas of the disputes is picture manufacturing.
For years, CVS has been a number one picture processing location for shoppers. Even in an period of digital pictures, tens of millions proceed to have movie processed or want a passport picture.
CVS claims in its swimsuit, “Through the years at subject, CVS Well being workers produced and bought Images in its U.S. retail shops, together with {photograph} prints, {photograph} and film compact discs (“CDs”) and digital video discs (“DVDs”), {photograph} image sheets, {photograph} enlargements, and U.S. passport and worldwide visa pictures. CVS Well being obtained gross receipts from clients for the sale of the Images.
Additional, CVS claims, “Through the years at subject, CVS Well being leased or owned and maintained at its U.S. retail shops the {photograph} processing gear vital to provide the Images, together with (i) {photograph} processing machines, (ii) movie processors, (iii) paper processors, (iv) duplex printers, and (v) kiosks. CVS Well being additionally owned and maintained at its U.S. retail shops the uncooked supplies vital to provide the Images, together with (i) {photograph} paper, (ii) ink, (iii) clean CDs, (iv) clean DVDs, (v) folders, (vi) jackets, and (vii) chemical substances.”
The swimsuit additional asserts, “Through the years at subject, skilled CVS Well being’s workers produced, in complete or in important half, the Images, in complete or in important half inside the US, by utilizing the {photograph} processing gear and uncooked supplies positioned within the U.S. retail shops to rework the retail clients’ undeveloped movie, movie damaging photographs, and digital media photographs into the completed Images.”
CVS didn’t reply to a request for remark.
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