FEDERAL INCOME TAX COMPLIANCE COSTS: A CASE STUDY OF HEWLETT-PACKARD COMPANY

This is a case study of U.S. federal income tax compliance costs at Hewlett-Packard Company (HP), a Fortune 100 multinational company. The paper covers the following topics: (1) resources needed for federal tax compliance; (2) compliance processes; (3) environmental factors, such as financial systems and corporate structure; and (4) reflections on complex and noncomplex substantive areas of compliance. HP's experience is that a large U.S. multinational company can complete an accurate corporate tax return with the functional equivalent of three full-time tax professionals. This is attributable primarily to a financial environment with a high degree of worldwide uniformity.