UPS vs IRS Settlement

[robonono]

From today's UPS press release:

"There were several non-recurring items during the fourth quarter, affecting both income and expense. First, UPS and the IRS recently finalized their tentative settlement of all outstanding tax issues related to excess value package insurance. As a result of the settlement, UPS recorded income, before taxes, of $1.02 billion during the fourth quarter. The credits and refunds associated with this settlement are expected to occur over the next several years."

 

[retired]

I have often wondered how that ruling would hold up. That is fantastic news!

 

[automotivedave]

for you that are still with the company. Have any of the higher ups, said how this will effect OPL's run off?

 

[robonono]

I'm retired, but do not see how this can affect OPL's runoff in any way. The money goes exclusively to UPS.

 

[michael]

robo
I agree completely all the money was put up by UPS and a nice portion was returned to UPS. OPL had no part in that money.

I am curious about one thing though. Why didn't that news have a more positive effect on the stock price today? I realize that the street looks at "future" projections and earnings but the last line in that statement was

"The credits and refunds associated with this settlement are expected to occur over the next several years"

if that's not future I don't know what is ....

Michael

 

[robonono]

I agree, Michael. I was disappointed with the upward move of our stock today - I had hoped for a $1 at least.

 

[gsx1990]

perhaps its because UPS is very fairly valued
at $61-$62 a share. The quarterly report, although good, continued to show a slide in ground volume. We can only hope this does not
continue.

 

[charlie]

One of the reasons I believe it didn't have a larger impact is that it fell under the "non-recurring" catagory. I didn't listen to the conference call, but noticed in all of the news stories that the announcement was buried somewhere in the middle of the article and only rated about two lines. There was very little detail on it otherwise. Does any one else wonder why we didn't make a bigger deal out of this and why it wasn't announced when we got the news rather than waiting for today?????

 

[wkmac]

The way I see this announcement is that we are all in the wrong line of work. The Tax Court ruled in the favor of the IRS (big surprise here) but Federal Courts overturned Tax Court decision. UPS put up $1.8bil in 99' so IRS has had this money almost 4 years and they still get to keep $600 mil! Based on what? I wish I could take money from people, hold it for 4 years without good cause and in the end keep 35% plus interest for no reason at all.

Time to give serious discussion to ending this Marxist Madness!

http://www.fairtax.org/