Hedge Fund’s Insiders Agree to Pay as Much as $7 Billion to I.R.S.

The agreement ends a longstanding tax dispute involving a decade’s worth of transactions at Renaissance Technologies, one of the world’s biggest and best-connected hedge funds.

The hedge fund pioneer James Simons and some of his former executives at Renaissance Technologies will pay billions of dollars to settle one of the largest federal tax disputes in history. In a letter to investors in one of the firm’s most successful funds, Renaissance said it had reached a settlement in a long-running dispute with the Internal Revenue Service to resolve its tax treatment for a decade’s worth of trading transactions. The settlement could be worth as much as $7 billion, according to a person with knowledge of the agreement.