Varian Ruling Opens Door for More Companies to Seek Deductions

More companies may get a boost from Varian Medical Systems’ recent court victory over the IRS and its ability to take advantage of a loophole in the 2017 tax-overhaul law.

Cisco Systems, the computer-networking giant, has said it’s looking at whether it can benefit from the Varian ruling, which allowed the company to take a big tax deduction on foreign dividends it received without the effects of a related measure that was supposed to limit the deduction.

Food-service distributor Sysco Corp. has already recorded a partial win over the IRS in a court case over claims similar to Varian’s, ...