MemGPT/example-sec-filings · Datasets at Hugging Face

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of operations and financial condition.

We are subject to regular review and audit by U.S. federal, state,
local, and foreign tax authorities. For example, our 2008 to 2022 tax
years remain subject to examination in the United States and California
due to tax attributes and statutes of limitations, and our 2018 to 2022
tax years remain subject to examination in Ireland. We are currently
under examination for income taxes by the Internal Revenue Service ("RS"
for the years 2013, 2016, 2017, and 2018. We are continuing to respond
to inquiries related to these examinations. In December 2020, we
received a Notice of Proposed Adjustment ("OPA" from the IRS for the
2013 tax year relating to the valuation of our international
intellectual property which was sold to a subsidiary in 2013. The notice
proposed an increase to our U.S. taxable income that could result in
additional income tax expense and cash tax liability of \$1.3 billion,
plus penalties and interest, which exceeds our current reserve recorded
in our consolidated financial statements by more than \$1.0 billion. We
disagree with the proposed adjustment and intend to vigorously contest
it. In February 2021, we submitted a protest to the IRS describing our
disagreement with the proposed adjustment and requesting the case be
transferred to the IRS Independent Office of Appeals ("RS Appeals". In
December 2021, we received a rebuttal from the IRS with the same
proposed adjustments that were in the NOPA. In January 2022, we entered
into an administrative dispute process with IRS Appeals. We will
continue to pursue all available remedies to resolve this dispute,
including petitioning the U.S. Tax Court ("ax Court" for redetermination
if an acceptable outcome cannot be reached with IRS Appeals, and if
necessary, appealing the Tax Court' decision to the appropriate
appellate court. If the IRS prevails in the assessment of additional tax
due based on its position and such tax and related interest and
penalties, if any, exceeds our current reserves, such outcome could have
a material adverse impact on our financial position and results

32

of operations, and any assessment of additional tax could require a
significant cash payment and have a material adverse impact on our cash
flow.

The determination of our worldwide provision for (benefit from) income
taxes and other tax liabilities requires significant judgment by
management, and there are many transactions where the ultimate tax
determination is uncertain. Our provision for (benefit from) income
taxes is also determined by the manner in which we operate our business,
and any changes to such operations or laws applicable to such operations
may affect our effective tax rate. Although we believe that our
provision for (benefit from) income taxes is reasonable, the ultimate
tax outcome may differ from the amounts recorded in our financial
statements and could materially affect our financial results in the
period or periods for which such determination is made. In addition, our
future tax expense could be adversely affected by earnings being lower
than anticipated in jurisdictions that have lower statutory tax rates
and higher than anticipated in jurisdictions that have higher statutory
tax rates, by changes in the valuation of our deferred tax assets and
liabilities, or by changes in tax laws, regulations, or accounting
principles. For example, we have previously incurred losses in the
United States and certain international subsidiaries that resulted in an
effective tax rate that is significantly higher than the statutory tax
rate in the United States and this could continue to happen in the
future. We may also be subject to additional tax liabilities relating to
indirect or other non-income taxes, as described in our risk factor
titled "---Uncertainty in the application of taxes to our Hosts, guests,
or platform could increase our tax liabilities and may discourage Hosts
and guests from conducting business on our platform."Our tax positions
or tax returns are subject to change, and therefore we cannot accurately
predict whether we may incur material additional tax liabilities in the
future, which would materially adversely affect our results of
operations and financial condition.

In addition, in connection with any planned or future acquisitions, we
may acquire businesses that have differing licenses and other
arrangements that may be challenged by tax authorities for not being at
arm'-length or that are potentially less tax efficient than our licenses
and arrangements. Any subsequent integration or continued operation of
such acquired businesses may result in an increased effective tax rate
in certain jurisdictions or potential indirect tax costs, which could
result in us incurring additional tax liabilities or having to establish
a reserve in our consolidated financial statements, and materially
adversely affect our results of operations and financial condition.

*Changes in tax laws or tax rulings could materially affect our results
of operations and financial condition.*

The tax regimes we are subject to or operate under, including income and
non-income (including indirect) taxes, are unsettled and may be subject
to significant change. Changes in tax laws or tax rulings, or changes in
interpretations of existing laws, could materially adversely affect our
results of operations and financial condition. On August 16, 2022, the
Inflation Reduction Act (the "RA" was signed into law in the United
States. Among other changes, the IRA introduced a corporate minimum tax
on certain corporations with average adjusted financial statement income
over a three-tax year period in excess of \$1 billion and an excise tax
on certain stock repurchases by certain covered corporations for taxable
years beginning after December 31, 2022. The United States government
may enact further significant changes to the taxation of business
entities including, among other changes, an increase in the corporate
income tax rate or significant changes to the

taxation of income derived from international operations. The likelihood
of these changes being enacted or implemented is unclear. In addition,

of operations and financial condition.

We are subject to regular review and audit by U.S. federal, state,

local, and foreign tax authorities. For example, our 2008 to 2022 tax

years remain subject to examination in the United States and California

due to tax attributes and statutes of limitations, and our 2018 to 2022

tax years remain subject to examination in Ireland. We are currently

under examination for income taxes by the Internal Revenue Service ("RS"

for the years 2013, 2016, 2017, and 2018. We are continuing to respond

to inquiries related to these examinations. In December 2020, we

received a Notice of Proposed Adjustment ("OPA" from the IRS for the

2013 tax year relating to the valuation of our international

intellectual property which was sold to a subsidiary in 2013. The notice

proposed an increase to our U.S. taxable income that could result in

additional income tax expense and cash tax liability of \$1.3 billion,

plus penalties and interest, which exceeds our current reserve recorded

in our consolidated financial statements by more than \$1.0 billion. We

disagree with the proposed adjustment and intend to vigorously contest

it. In February 2021, we submitted a protest to the IRS describing our

disagreement with the proposed adjustment and requesting the case be

transferred to the IRS Independent Office of Appeals ("RS Appeals". In

December 2021, we received a rebuttal from the IRS with the same

proposed adjustments that were in the NOPA. In January 2022, we entered

into an administrative dispute process with IRS Appeals. We will

continue to pursue all available remedies to resolve this dispute,

including petitioning the U.S. Tax Court ("ax Court" for redetermination

if an acceptable outcome cannot be reached with IRS Appeals, and if

necessary, appealing the Tax Court' decision to the appropriate

appellate court. If the IRS prevails in the assessment of additional tax

due based on its position and such tax and related interest and

penalties, if any, exceeds our current reserves, such outcome could have

a material adverse impact on our financial position and results

32

of operations, and any assessment of additional tax could require a

significant cash payment and have a material adverse impact on our cash

flow.

The determination of our worldwide provision for (benefit from) income

taxes and other tax liabilities requires significant judgment by

management, and there are many transactions where the ultimate tax

determination is uncertain. Our provision for (benefit from) income

taxes is also determined by the manner in which we operate our business,

and any changes to such operations or laws applicable to such operations

may affect our effective tax rate. Although we believe that our

provision for (benefit from) income taxes is reasonable, the ultimate

tax outcome may differ from the amounts recorded in our financial

statements and could materially affect our financial results in the

period or periods for which such determination is made. In addition, our

future tax expense could be adversely affected by earnings being lower

than anticipated in jurisdictions that have lower statutory tax rates

and higher than anticipated in jurisdictions that have higher statutory

tax rates, by changes in the valuation of our deferred tax assets and

liabilities, or by changes in tax laws, regulations, or accounting

principles. For example, we have previously incurred losses in the

United States and certain international subsidiaries that resulted in an

effective tax rate that is significantly higher than the statutory tax

rate in the United States and this could continue to happen in the

future. We may also be subject to additional tax liabilities relating to

indirect or other non-income taxes, as described in our risk factor

titled "---Uncertainty in the application of taxes to our Hosts, guests,

or platform could increase our tax liabilities and may discourage Hosts

and guests from conducting business on our platform."Our tax positions

or tax returns are subject to change, and therefore we cannot accurately

predict whether we may incur material additional tax liabilities in the

future, which would materially adversely affect our results of

operations and financial condition.

In addition, in connection with any planned or future acquisitions, we

may acquire businesses that have differing licenses and other

arrangements that may be challenged by tax authorities for not being at

arm'-length or that are potentially less tax efficient than our licenses

and arrangements. Any subsequent integration or continued operation of

such acquired businesses may result in an increased effective tax rate

in certain jurisdictions or potential indirect tax costs, which could

result in us incurring additional tax liabilities or having to establish

a reserve in our consolidated financial statements, and materially

adversely affect our results of operations and financial condition.

*Changes in tax laws or tax rulings could materially affect our results

of operations and financial condition.*

The tax regimes we are subject to or operate under, including income and

non-income (including indirect) taxes, are unsettled and may be subject

to significant change. Changes in tax laws or tax rulings, or changes in

interpretations of existing laws, could materially adversely affect our

results of operations and financial condition. On August 16, 2022, the

Inflation Reduction Act (the "RA" was signed into law in the United

States. Among other changes, the IRA introduced a corporate minimum tax

on certain corporations with average adjusted financial statement income

over a three-tax year period in excess of \$1 billion and an excise tax

on certain stock repurchases by certain covered corporations for taxable

years beginning after December 31, 2022. The United States government

may enact further significant changes to the taxation of business

entities including, among other changes, an increase in the corporate

income tax rate or significant changes to the

taxation of income derived from international operations. The likelihood

of these changes being enacted or implemented is unclear. In addition,