LPL drops lawsuit seeking tax refund from IRS

In a stipulated agreement to remove a lawsuit seeking millions of dollars in IRS tax refunds from court permanently, LPL Financial dropped its legal case against the government.

The parties to LPL’s lawsuit in San Diego federal court filed a motion April 5 to dismiss the firm’s claims that IRS owed the firm more than $5.4 million in tax refunds between 2012 and 2014 for the development of its former financial advisor desktop software, BranchNet. LPL filed the case in late August 2023. On April 8, Chief District Judge Dana Sabraw entered a judgment “in favor of defendant United States and against plaintiff” dismissing LPL’s claims with prejudice. 

In a March filing, LPL had notified the federal government of its plans to dismiss the lawsuit. LPL may pursue a refund for research credits through the Independent Office of Appeals at the IRS.

“Accordingly, the parties do not anticipate any further dispute and intend to prepare stipulations to be filed with the court entirely resolving plaintiff’s claims within the next 30 days,” LPL’s earlier filing said.

The resulting stipulated agreement reached by the two sides last week will “allow the parties to pursue the refund through administrative means,” LPL and the federal government said in the joint motion to dismiss the case.

Representatives for LPL didn’t respond to an email seeking comment on the agreement, which was first reported by Bloomberg Tax.