Microsoft shakes off $28.9B tax bill
Kativ
Microsoft (NASDAQ:MSFT) shares shook off a notice from the Internal Revenue Service that it owed $28.9B in back taxes plus interest and fines as investment firm KeyBanc Capital Markets noted that amount may be inflated. 
The stock was up 0.3% on Thursday morning.
On Wednesday, the Bill Gates-founded tech giant said that it received notices of the proposed adjustment on September 26 and it disagreed with them, vowing to go to court if necessary.
Microsoft (MSFT) said in a blog post that it believes the proposed amount is not final, and does not reflect taxes paid under the Tax Cuts and Jobs Act, which could potentially decrease the tax amount owed by up to $10B, KeyBanc Capital Markets analysts led by Michael Turits wrote in a note. 
âIn the event Microsoft (MSFT) and the IRS don't come to a direct agreement, Microsoft (MSFT) says it will then have the opportunity to contest unresolved issues through the courts,â Keybanc said. The tech company said it does not expect to reach a final resolution of in the next 12 months, and does not anticipate a significant change to the tax contingencies for these issues in that time frame.
The company said its allowances for income tax contingencies as adequate. 
Senator Elizabeth Warren weighed in on the issue, saying that the IRS is fighting against "illegally offshoring profits."
"Itâs time for giant corporations to pay their fair share," Senator Warren added.
Should the IRS's stance be upheld, full payment of the $28.9B fee plus penalties would likely be made in 2025. 
âThis would imply lost interest income of $800M-$1,200M (assuming a 3-4% interest rate) or 1% reduction in annual net income,â Keybanc said, adding that the situation prompted no change to its model.

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