Procter & Gamble sues IRS, wants $435 mln returned

CHICAGO (Reuters) - Procter & Gamble Co PG.N is suing the U.S. government, seeking the return of nearly $435 million in taxes and interest it paid due to an Internal Revenue Service audit with which the company disagrees.

P&G, the maker of Tide laundry detergent and Gillette razors, said it paid more than $6 billion in federal income taxes for the tax years of 2000 to 2005.

In 2005, the IRS started auditing P&G’s tax returns for the tax years of 2001 through 2005, P&G said in a complaint filed on Sept. 10. Then, the IRS sent P&G a notice of deficiency on June 5, 2008, claiming adjustments should be made to some items and assessing more tax for the 2000 tax year, P&G said.

The consumer products company said “virtually all” of the adjustments made by the IRS were erroneous, but it paid the extra taxes and interest as it was required to do.

Now it wants a refund.

P&G said the IRS asked for more money after looking into tax credits the company claimed for technology donated to colleges and universities, as well as artwork donated to the Cincinnati Art Museum and the National Underground Railroad Freedom Center. The IRS also denied certain credits related to spending on patent work and research, among other items.

A spokeswoman for Cincinnati-based P&G said the company could not comment on pending litigation. A spokesman for the IRS said it generally does not comment on pending litigation.

The lawsuit, Procter & Gamble Co v. United States of America, was filed on Sept. 10 in the U.S. District Court for the Southern District of Ohio.

Summonses to the IRS and the U.S. Attorney’s Office for the Southern District of Ohio to answer to the complaint were filed with the court on Thursday.

Reporting by Jessica Wohl, editing by Leslie Gevirtz