Merck settles tax dispute with IRS for $2.3 billion

Merck has entered an agreement to settle its previously disclosed tax disputes with the Internal Revenue service for $2.3 billion. The settlement essentially brings to a close the IRS’s examination of the company for the period 1993-2001, the Whitehouse Station, NJ drugmaker said in a statement issued today. The figure of $2.3 billion will cover federal tax and net interest after deductions and penalties, Merck said. The IRS' examination of years subsequent to 2001 remains open. Merck announced in November that it faced potential tax liabilities totaling $5.58 billion from US and Canadian authorities related to disputes over accounting for past transactions.