(credit: Getty Images)

Amazon has successfully emerged from a lawsuit brought by the Internal Revenue Service, saving the company from a huge potential tax bill.

A federal tax court judge ruled last week that the agency’s determination that Amazon’s re-assessed tax liability for 2005 and 2006 of $1.5 billion plus interest was “arbitrary, capricious, and unreasonable.”

Had Amazon lost, it would have had to pay that full amount, plus interest, and perhaps more for subsequent years.