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NewsPoster May 3, 2013 10:20 AM
Moody's estimates Apple saving up to $9.2B via bond sale
Apple's <a href="http://www.macnn.com/articles/13/04/30/goldman.sachs.deutsche.bank.confirmed.as.partners/">$17 billion bond sale</a> -- meant to help finance a $55 billion stock buyback, part of a plan to return $100 billion to shareholders by 2015 -- is saving the company about $9.2 billion in taxes, according to an estimate from Moody's Investment Services. Had Apple decided to use repatriated foreign cash, it would have paid a 35 percent tax rate, and hence owed the US about $9.2 billion.<br /><br />The company will still have to pay roughly $308 million per year interest for its bond offering, but that interest is tax-deductible, which should lower the real cost by about $100 million per year. Spokesman Steve Dowling <a href="http://macnn.com/rd/284840==http://www.bloomberg.com/news/2013-05-02/apple-avoids-9-2-billion-in-taxes-with-debt-deal.html" rel='nofollow'>comments</a> that for its 2012 fiscal year, Apple paid about $6 billion in federal income taxes, which Dowling claims is 1 out of every 40 dollars in corporate income taxes the US government took in.<br />
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Apple has roughly $145 billion in cash reserves, but only $45 billion of that is situated in the US. The company has joined with other businesses in trying to pressure politicians for a "tax holiday," which would temporarily lower the tax rate on repatriated cash. That option may be politically difficult, however, given the government's budget crisis and public demands for fair taxation.
 
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