On March 6, 2007, Standard&Poor's Ratings Services said its rating and outlook for Marriott International Inc. (BBB+/Stable/A-2) would not be affected by the IRS' challenge of $1 billion in income tax deductions related to the company's leveraged employee stock ownership plan (ESOP). The IRS challenge follows an audit of federal tax returns filed in 2000, 2001, and 2002, and potentially could disallow a meaningful amount of the deductions and impose substantial excise taxes and penalties. Marriott plans to defend its position and examine alternatives for resolving the matter with the IRS. While Marriott has not yet publicly stated the extent of its exposure in the event of an adverse resolution of the challenge, Standard&Poor's expects Marriott
