A credit is allowed for foreign income taxes paid or accrued. The financing is limited to that particular part of Ough.S. tax due to foreign source income. It is not refundable, memek but any excess credit may be carried to other years to reduce tax. In addition, Merck, another pharmaceutical company, agreed invest the IRS $2.3 billion o settle allegations of kontol. It purportedly shifted profits offshore. In that case, Merck transferred ownership of just two drugs (Zocor and Mevacor) into a shell it formed in Bermuda.

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