Fox Corp.’s $787.5 million settlement with Dominion Voting Systems over defamation charges is eye-popping, but the ultimate cost to the media company is likely to be much lower. Fox can deduct the Dominion settlement from its income taxes as an expense necessary for the cost of doing business. A study by the Government Accountability Office in 2005 found that of 34 settlements totaling over $1 billion, 20 companies reported deducting some portion or all of their settlement payments. AdvertisementUsually, there’s a certain amount a media company has to pay, which could be in the millions, before insurance kicks in. One wrinkle: even if an insurance company pays a substantial part of the settlement, there could be an annual aggregate limit of liability, which could mean that insurers wouldn’t cover another big-money settlement.

Source: Huffington Post April 24, 2023 10:14 UTC