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Current law could allow Fox News to claim a $213 million tax deduction on settlement with Dominion [1]
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Date: 2023-05-03
Federal law allows taxpayers to write off many legal costs, providing that they are “ordinary and necessary” business expenses. The IRS has affirmed that paying out settlements is a legitimate cost of doing business.
"If your business model is to tell lies so that you'll get viewers and have lots of advertising revenues, then, odious though this business model may be, the tax system's job is to tax you on the profits that you actually make from it," explains Daniel Shaviro, a professor of tax law at New York University." And those profits are indeed reduced when you are successfully sued by the victims of your malicious falsehoods."
There are exceptions to this rule, such as settlement payments in sexual harassment cases, or paying off fines to the government. But defendants can generally write off the costs when it comes to a defamation lawsuit between two corporate parties (like Fox and Dominion).
We are still cleaning up the considerable damage Fox's lies inflicted on our democracy. The Dominion settlement is the first but likely not the last act of accountability. Fox and other bad corporate actors should not be able to write off any portion of settlement fees as part of the cost of doing business.
Sign if you agree: Corporations should not get a tax reward for spreading misinformation about elections and voting.
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[1] Url:
https://www.dailykos.com/stories/2023/5/3/2140963/-Current-law-could-allow-Fox-News-to-claim-a-213-million-tax-deduction-on-settlement-with-Dominion
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