Yum! Brands Sues IRS Over $4 Billion Realignment Tax Bill (1)

Restaurant giant Yum! Brands Inc. sued the IRS late Wednesday in an attempt to block a $4 billion tax bill over corporate reorganization transactions that the company contends should be tax-free.

The company’s complaint, filed in US Tax Court, alleges that the IRS made erroneous adjustments to the company’s 2013-2015 taxes in attempting to levy taxes and penalties on transactions related to a 2014 series of reorganizations by Yum, which owns restaurant chains KFC, Pizza Hut, and Taco Bell.

Yum maintained that it didn’t underpay its taxes, as the IRS had alleged. The complaint asks the court to determine that ...