American Express Hit With $235 Million Transfer Pricing Tax Bill

The IRS is seeking $235 million in unpaid taxes from American Express in a dispute over the company’s transfer pricing, according to financial filings. The company plans to contest the adjustment.

American Express Co. received the notice of proposed adjustment from the IRS in December, seeking $185 million for 2017 and 2018—not including interest or state taxes—plus $50 million in penalties.

Transfer pricing involves valuation of transactions between entities within a corporate group. Intragroup transactions must be conducted at arm’s length—priced similarly to transactions between unrelated companies.

• At issue is the company’s transfer pricing between its US and ...