Federal Case Study

Healthcare Provider

This healthcare provider is one of the nation’s largest providers of post-acute healthcare services. It provides both facility-based services and home-based services to patients in 36 states. It employs over 38,000 people and is in the S&P 400 group of companies.
The company has a long history of IRS audits. In 2013, the company signed a final closing agreement with the IRS that included the years from 1994 to 2008. It had reported substantial income for the years 1994 – 2001 and substantial losses from 2002 – 2008 which resulted in loss carry backs to years 1994 – 2001. The carryback of the losses resulted in refunds of all previously paid tax for the earlier years. The last refunds were received in 2009. The company felt that the overpayment interest that was calculated by the IRS was incorrect and requested the IRS calculate the interest properly prior to the 2009 refund being issued. The IRS refused to do so.
The company retained Ashland to review its transcripts to perform a Complex Interest Study for the periods involved and file claims for any overpayments using the self-identified issue. Claims were prepared and filed within 30 days and when it appeared the IRS was not going to be able to process the claims before the expiration of the statute, upon the advice of Ashland, the company filed a protective claim in the US Court of Claims. Ashland worked with the client’s outside counsel to achieve a favorable settlement of the overpaid amount.

Total interest recovered: $943,600