The notices cover transactions between UnitedHealth and a foreign subsidiary from the 2017 through 2020 tax years, according to the May filing. The IRS is seeking to “significantly increase taxable income” for each of those years, and could seek similar adjustments for later years.

UnitedHealth is not conceding. In its August filing, the company said it believes its tax positions are properly supported and plans to “vigorously contest” the IRS’s proposed adjustments.

This dispute comes amid a broader push from the IRS that began more than a decade ago to scrutinize how American multinational corporations allocate profits between their U.S. operations and foreign subsidiaries.

“This is quite common because the IRS has, since the Obama administration, increased its scrutiny of transfer pricing by U.S. based multinationals who are trying to shift profits out of the U.S. to their foreign subsidiaries,” Reuven S. Avi-Yonah, the Irwin I. Cohn Professor of Law at the University of Michigan Law School, told Fortune.

The agency has fought similar battles with some of corporate America’s biggest names, including Coca-Cola, Meta and Medtronic. Those cases have produced very different outcomes.

“The IRS has won some of these cases and lost others and the sums involved are usually in the billions,” Avi-Yonah said.

UnitedHealth emphasized that the dispute remains unresolved.

“The company has previously disclosed the IRS examination and related tax matters in its public filings and believes its tax positions are properly supported,” a UnitedHealth Group spokesperson told Fortune. The spokesperson said the matters “remain subject to further review and discussions.”

Neither filing names the subsidiary, says where it is based, describes the transactions at issue, or attaches a dollar figure to what the IRS is seeking.

That makes UnitedHealth’s dispute difficult to size. While other transfer-pricing fights have involved billions of dollars, neither the company nor the IRS has disclosed enough to know what transactions the agency is challenging here or how much money is at stake.

A Notice of Proposed Adjustment is issued during an examination. It is a proposal, not a final determination, assessment, or penalty. A company that disagrees can contest it through an administrative process, and unresolved disputes can reach court.

What is transfer pricing?

At issue is the price a company sets on transactions between its own units in different countries. Since those prices can affect how much profit is attributed to each country, they can also affect where taxes are paid.

Section 482 of the tax code allows the IRS to adjust a company’s taxable income if it believes transactions between related businesses were not fairly priced. 

The rule is simple to state but notoriously hard to apply because there is often no unrelated third party doing the same deal to compare against. Two sides can examine the same intercompany transactions and reach different conclusions, leading to disputes that can take years to resolve.

But UnitedHealth’s disclosure does not reveal what kind of transaction triggered the proposed adjustment.

Many major transfer pricing disputes have centered on intellectual property transferred to foreign subsidiaries, Avi-Yonah said. But he cautioned he does not know enough about UnitedHealth specifically to say what the agency is examining.

How big can transfer-pricing fights get?

Coca-Cola shows how large a transfer-pricing disagreement can become.

The beverage giant’s dispute could ultimately involve roughly $20 billion in tax and interest. Coca-Cola has already paid the IRS $6 billion covering tax years 2007 through 2009 while it appeals, and estimates it could face roughly $14 billion in additional tax and interest for 2010 through 2025 if the IRS adjustments upheld by the Tax Court ultimately stand. Its reserve stood at $529 million as of July 3, 2026. 

Meta is also contesting an IRS notice asserting $15.89 billion in additional tax, plus interest and penalties, for its 2017 through 2019 tax years, primarily related to transfer pricing with foreign subsidiaries and other international tax adjustments. The company petitioned the Tax Court in December 2025.

These disputes can outlive multiple corporate and presidential administrations. Coca-Cola’s fight concerns tax years 2007 through 2009, while Medtronic’s began with its 2005 and 2006 tax years and just entered settlement talks this March after two trips to a federal appeals court. Avi-Yonah has written that the Medtronic case will likely take more than 20 years to resolve.

None of these cases predicts where UnitedHealth’s dispute will land. However, they do show how large and how protracted transfer pricing fights can become once they escalate.

What happens next?

If the dispute is not resolved during the examination, UnitedHealth can pursue the IRS administrative appeals process and potentially litigate the matter.

One number in UnitedHealth’s filings offers little help in determining the company’s potential exposure. Its gross unrecognized tax benefits rose to $5.6 billion at the end of 2025 from $4.1 billion a year earlier, but the company cautioned against connecting that figure to this dispute.

A UnitedHealth spokesperson said the $5.6 billion reflects reserves across all of the company’s uncertain tax positions and “should not be interpreted as the amount associated with the NOPAs.” The company declined to say how much of the total, if any, relates to this dispute or to identify the foreign subsidiary involved.

The IRS did not respond to Fortune’s request for comment. The agency is generally barred by federal law from discussing individual taxpayers.

UnitedHealth said in its August filing it believes its reserves for uncertain tax positions are adequate “based on current available information,” and it intends to contest the proposed adjustments.