IRS Wins Remand In Excise Tax Fight With WorldCom

Law360, New York (August 10, 2009, 3:08 PM EDT) -- Modems used by bankrupt WorldCom Inc. in certain of its telecommunications systems were two-way communications devices, a district court judge has ruled, remanding to bankruptcy court a fight over $38 million in tax payments for such systems.

Judge Barbara S. Jones’ decision, issued Friday in the U.S. District Court for the Southern District of New York, turned aside WorldCom's argument that the phone lines in question were for incoming calls only and thus were not taxable under the relevant federal statute.

The ruling came almost two...
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