Varian Owes $7 Million After Tax Court Sunk Dividend Deductions

Global medical manufacturer Varian Medical Systems Inc. is liable for a $7.3 million tax deficiency after a prior US Tax Court opinion disallowed some of the dividend deductions the company claimed for its 2018 tax year, according to a stipulated decision entered in the court.

Judge Emin Toro on Monday said the parties’ computation aligned with his April opinion, which held Varian didn’t directly hold shares of some controlled foreign corporations for which the deductions were claimed, and were thus ineligible for IRC Section 245A deductions for them. Section 245A was enacted in 2017 by a Republican tax and ...