By Jim Puzzanghera and Chris O’Brien
May 20, 2013, 2:04 p.m.

This post has been corrected. See the note at the bottom for details

WASHINGTON — Apple Inc. has used an elaborate web of offshore subsidiaries to avoid paying billions of dollars in U.S. taxes on $44 billion in foreign income over the past four years, a Senate investigation has found.

Many of the tactics, such as cost-sharing arrangements, are common among large multinational corporations seeking to shift profits to countries with lower tax rates. The investigation did not find Apple violated any laws.

But three of its subsidiaries in Ireland claim to have no responsibility to pay income taxes to any country, according to a 40-page, bipartisan report released Monday by the Senate Permanent Subcommittee on Investigations.

One of those subsidiaries, Apple Operations International, which has no employees but reported $30 billion in income from 2009-2012, has not filed an income tax return in any country for the past five years, the investigation found.

“Apple wasn’t satisfied with shifting its profits to a low-tax, offshore tax haven,” said Sen. Carl Levin (D-Mich.), the subcommittee’s chairman and a longtime advocate for tightening U.S. corporate tax laws. “Apple sought the Holy Grail of tax avoidance.”

Quiz: Test your Apple knowledge

Chief Executive Timothy Cook is scheduled to testify Tuesday about the company’s tax practices at a hearing by the subcommittee on offshore profit shifting. Apple’s chief financial officer, Peter Oppenheimer, and its head of tax operations, Phillip Bullock, also are scheduled to testify.

In written testimony prepared for the hearing, Apple said the company is “a powerful engine of job creation in the U.S.” and “pays an extraordinary amount in U.S. taxes” — $6 billion last year.

Apple said it does not use “tax gimmicks.”

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