MCI Hit by Bigger Tax Bill - TheStreet

MCI

(MCIP)

isn't complaining or anything, but these taxes are killing it.

The Ashburn, Va., telco adjusted its 2004 numbers Wednesday to account for a bigger net loss due to an increased tax bill. MCI says its tax provision for the fourth quarter ended in December increased to $528 million, from $415 million previously reported, according to the company's annual report Wednesday.

The adjustment increases MCI's loss for the quarter to $145 million from $32 million, as

originally reported last month.

The mistake prompted the company to seek better internal controls over its tax calculations. The company says it hired a vice president and separate staff to specifically handle taxes. It will also use outside tax accountants to help decipher complex tax issues.

MCI has agreed to merge with

Verizon

(VZ) - Get Report

, but has been given two weeks to evaluate a competing offer from

Qwest

(Q)

. MCI is expected to announce tomorrow the results of its Qwest bid review.

Observers expect Qwest to boost its bid and some say it is likely that Verizon may tweak its original offer to help make the

decision easier for MCI's board.