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JPMorgan can deduct big chunk of $13 billion deal [View all]
Source: CNNMoney
JPMorgan can deduct big chunk of $13 billion deal
By Jeanne Sahadi @CNNMoney November 19, 2013: 7:06 PM ET
NEW YORK (CNNMoney)
The majority of the $13 billion settlement JPMorgan struck with the government Tuesday is likely to be tax deductible, reducing the bank's financial hit.
Here's why: Many of the costs associated with corporate legal cases are treated as deductible under the tax code, in much the same way that a company's wages or equipment expenses are.
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And it's JPMorgan's understanding that the $2 billion is not deductible, the bank's chief financial officer said on an analyst call Tuesday.
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But here's the general bottom line: The compensation or restitution portions of a settlement like the one struck by JPMorgan (JPM, Fortune 500) may be deducted, but the penalties can't.
[font size=1]-snip-[/font]
By Jeanne Sahadi @CNNMoney November 19, 2013: 7:06 PM ET
NEW YORK (CNNMoney)
The majority of the $13 billion settlement JPMorgan struck with the government Tuesday is likely to be tax deductible, reducing the bank's financial hit.
Here's why: Many of the costs associated with corporate legal cases are treated as deductible under the tax code, in much the same way that a company's wages or equipment expenses are.
[font size=1]-snip-[/font]
And it's JPMorgan's understanding that the $2 billion is not deductible, the bank's chief financial officer said on an analyst call Tuesday.
[font size=1]-snip-[/font]
But here's the general bottom line: The compensation or restitution portions of a settlement like the one struck by JPMorgan (JPM, Fortune 500) may be deducted, but the penalties can't.
[font size=1]-snip-[/font]
Read more: http://money.cnn.com/2013/11/19/news/companies/jpmorgan-doj-deal/
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