Citrix agrees to stump up millions to settle with tax man

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Citrix agrees to stump up millions to settle with tax man

Simon Quicke

Citrix could take a hit of up to $15m in its second quarter earnings after the software player came to an agreement with tax authorities in the US.

The settlement in principle has been made between the Internal Revenue Service (IRS) and Citrix to take a hit in the next quarterly results and end an issue that has been running for almost a year.

Citrix was told by the IRS in late 2009 that a review of its tax returns for 2004 and 2005 were short to the tune of $81.3m.

The vendor hit back and filed a protest to contest the amount and revealed in an SEC filing that an agreement with the IRS has been agreed in principle: "Based on this, the Company expects to incur a charge of approximately $12 to $15 million in the second quarter of fiscal year 2010."

Even with the settlement in principle agreed it could still take months for the written agreement to come from the IRS but already investors will be preparing for a hit in the next set of results.
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