Multinationals Can’t Rely on California Ruling in Microsoft’s Favor

A ruling from the California Office of Tax Appeals that Microsoft is owed a $94 million income tax refund tied to its treatment of repatriated earnings won’t automatically apply to other multinational companies with similar claims.

The OTA posted its opinion Tuesday, along with a companion ruling denying the Franchise Tax Board’s request to reconsider, without making it precedential. The ruling in Microsoft’s favor allows the company to include $108.8 billion in gross foreign dividends from repatriation allowed under the 2017 federal tax law in calculating its taxable income in California compared with other states.

• Without a precedential ...