Posted on: Friday, July 9, 2004

IRS seeks $128.9M from Hawaiian

Advertiser Staff and Wire Services

The Internal Revenue Service has filed a $128.9 million claim against Hawaiian Airlines for excise and corporate income taxes, but Hawaiian's bankruptcy trustee believes the amount will be "greatly reduced."

The IRS believes that Hawai'i's largest airline owes $84.1 million in overdue taxes, $40.5 million in penalties and $4.3 million interest.

"As is often the case with initial proof of claim filings, we believe the estimate is substantially overstated and expect the claim will be greatly reduced by the bankruptcy court," Josh Gotbaum, Hawaiian's bankruptcy trustee, said in a statement. "Hawaiian Airlines has been providing detailed information and cooperating fully with the IRS over the past year. A claim of this magnitude is unjustified and we look forward to resolving this issue in court."

The claim was filed last month in U.S. bankruptcy court and covers the periods from March 2001 to June 2003. Hawaiian filed for federal bankruptcy protection in March 2003.

The state Department of Taxation also has filed a claim for back state taxes, but the amount has not been disclosed.