# ASBCA Allows RTX to Seek Tax Reimbursement

The Armed Services Board of Contract Appeals (ASBCA) granted RTX summary judgment allowing it to seek reimbursement from the U.S. government for state income taxes associated with capital gains from its corporate reorganization following its 2020 acquisition of United Technologies Corp. The decision says the Federal Acquisition Regulation does not categorically make those taxes unallowable. It addresses cost allowability; it does not establish that RTX will recover the costs, and the signals give no reimbursement amount or specific contract or case number.

- Defense contractors involved in corporate reorganizations or acquisitions can use the ruling as relevant precedent when assessing the treatment of related state income tax costs under the FAR.
- The decision concerns whether such costs may be allowable, not automatic reimbursement; contractors should distinguish the ruling’s cost-treatment finding from the outcome of RTX’s recovery claim.
- The signals identify no contract-specific details or amount, so the ruling’s financial impact on RTX and any broader contract-level effects are not quantified.

**Jurisdictions:** federal
**Industries:** Defense & Military
**Topics:** Regulatory Compliance
**Published:** October 28, 2026

### Government Entities
- Armed Services Board of Contract Appeals (ASBCA)

### Vendors
- RTX Corp. (Defense contractor seeking reimbursement of state income tax costs)
- United Technologies Corp. (Company acquired by RTX in 2020)
- Raytheon Company (Company involved in the merger with United Technologies)

### Sources
- [Defense contractor RTX Corp. can ask the US government to reimburse state income tax costs the company incurred after acquiring United Technologies Corp. in 2020. https://t.co/WuMvXuaJiD](https://x.com/BLaw/status/2115519076348936393) - twitter-fed-procurement