Timberland, North Face Maker’s $505 Million IRS Bill Upheld

A company that provides footwear and apparel under brands including North Face and Wrangler owes nearly $505 million more in taxes after it underreported income tied to transferring intangible property, the U.S. Tax Court ruled.

The Monday ruling from Senior Judge James S. Halpern dealt with taxes arising out of post-acquisition restructuring following the combination of two businesses, VF Corp. and Timberland Co. The businesses are involved in designing, making, and selling footwear and apparel through brands that also include Timberland, Vans, and SmartWool.

The Tax Court agreed with the IRS that increasing the income of TBL Licensing LLC—the common ...