By Leslie Scism

Life insurer MetLife Inc. said it would take a $792 million charge against third-quarter earnings to reflect that it may owe more federal taxes for past years, prompted by an adverse court ruling earlier this month involving other companies in a similar tax dispute.

The nation's biggest life insurer said it stands by its tax treatment, but said the charge "is the result of the company's consideration of recent decisions of the U.S. Court of Appeals for the Second Circuit upholding the disallowance [by the Internal Revenue Service] of foreign tax credits" claimed by other companies. MetLife's action relates to tax years 2000 to 2009 and involves the tax treatment of a wholly-owned U.K. investment subsidiary of MetLife.

"There has been no change in the company's position on the disallowance of its foreign tax credits" by the IRS, the company said Wednesday. "MetLife continues to contest the disallowance of these foreign tax credits by the IRS as management believes the facts strongly support the company's position."

MetLife said the noncash, after-tax charge to operating earnings and net income would be 70 cents a share. The company also said it does not expect any additional charges related to this matter.

In the third quarter of 2014, MetLife reported net income of $2.1 billion, or $1.81 per share.

"This is not a trivial charge," David Havens, a credit analyst with Imperial Capital LLC, said of MetLife's announcement, though he added "this should be manageable."

MetLife had flagged a disagreement with the IRS in an earlier regulatory filing. In a fresh filing Wednesday with the Securities and Exchange Commission, the company said the income in question was taxable in the U.K., and most of the taxes were paid to the U.K. taxing authority.

"As required by U.S. law, MetLife also paid additional taxes to the [IRS] to the extent the U.S. tax rate was higher than the U.K. tax rate, " the company said. "What is primarily in dispute with the IRS is whether it was appropriate for the company to reduce its U.S. taxes due to credits for U.K. taxes or whether the company must also pay U.S. taxes at the full U.S. rate."

Write to Leslie Scism at leslie.scism@wsj.com

(END) Dow Jones Newswires

September 16, 2015 17:32 ET (21:32 GMT)

Copyright (c) 2015 Dow Jones & Company, Inc.
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