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Intel Lightens Repatriated Tax Estimate

Chris Kraeuter

Intel(INTC Quote) said a possible repatriation of $6 billion in foreign-based earnings could result in a tax bill of up to $350 million during the current quarter -- less than previously thought.

The projected tax is $125 million less than an estimate provided three months ago, which was based on a possible repatriation of up to $6 billion.

Intel made the disclosure in its quarterly filing with the Securities and Exchange Commission on Monday. The company said it hopes to finalize its analysis by the end of this quarter.

Domestic corporations have a one-time opportunity to bring back into the U.S. accumulated earnings garnered overseas at a reduced tax rate under the American Jobs Creation Act of 2004. Many corporations have taken or plan to take advantage of the opportunity, but doing so creates an extra tax charge.

At the start of Intel's third quarter, the company predicted a tax rate of 30.5%, excluding any impact of repatriated earnings. The company will provide a midquarter update on Sept. 8 and actual financial results will be announced on Oct. 18.

On Monday, Intel shares rose 0.4% to $26.89.

Also in the quarterly filing, Intel stated that Korea's Fair Trade Commission has requested documents related to marketing and rebate programs with Korean PC manufacturers. The request was made in June and Intel said it is cooperating.

The latest request follows the Japan Fair Trade Commission's findings in March that Intel violated the country's antimonopoly act. Since then, rival Advanced Micro Devices(AMD Quote) has sued Intel in the U.S. and Japan.