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UPDATE 1-Tax haven use prevalent among Fortune 500 cos-activist groups

* Cayman Islands, Bermuda common sites of shell companies

* U.S. multinationals avoid $90 bln/year in taxes - report

* Business-aligned research group says report "misleading"

(Adds Tax Foundation, PwC comments, paragraphs 7-8 and 12-13)

WASHINGTON, June 5 (Reuters) - Most Fortune 500 corporations have units in offshore tax havens that they use to avoid paying U.S. taxes through "accounting tricks," two left-leaning tax activist groups said on Thursday.

In a report that comes amid increased attention to corporate tax avoidance worldwide, the groups said U.S. multinationals each year avoid paying about $90 billion in federal income tax.

"Many large, U.S.-based multinational corporations avoid paying U.S. taxes by using accounting tricks to make profits made in America appear to be generated in offshore tax havens - countries with minimal or no taxes," said Citizens for Tax Justice (CTJ) and U.S. Public Interest Research Group (PIRG).

About 72 percent of Fortune 500 companies had subsidiaries in low-tax jurisdictions in 2013, with most of these units located in the Cayman Islands or Bermuda, said the report.

"These subsidiaries are often shell companies with few, if any employees, and which engage in little to no real business activity," it said.

Big corporations regularly defend their tax planning practices as legal and in the best interest of shareholders, who want companies to pay as little tax as possible.

The CTJ/PIRG report was criticized by the Tax Foundation, a business-aligned tax activist group, as "misleading."

"There's no doubt that U.S. corporations use a variety of legal methods to reduce their corporate tax bill on their overseas operations," the foundation said. "If we are going to reform our tax code, it is best to be informed by the best information available. This study doesn't cut it."

Fiscal constraints facing many governments, as well as a step-up recently in the aggressiveness of some corporate tax-avoidance strategies, have fueled a political backlash.

Earlier this week, the Paris-based Organization for Economic Co-operation and Development held a conference in Washington on its effort to rein in corporate tax avoidance, launched last year at the request of the G20 group of leading world economies.

The OECD project has a long way to go, with completion not expected until next year, and it will not have the force of law. But lawyers and accountants agree that changes are coming if national legislatures enact the OECD's recommendations.

PricewaterhouseCoopers, a major accounting firm, in a report last month discussed "a dramatic surge in international tax controversy" and forecast cross-border disputes would continue.

OECD member nations reported a record-setting 4,061 bilateral tax treaty disputes in 2012, up 6 percent from 2011 and up 73 percent from 2006, the accounting firm said.

The U.S. Congress has not thoroughly overhauled the tax code since 1986, leaving it riddled with loopholes that corporations, families and individuals can take advantage of.

"The loopholes in America's corporate tax (code) have grown so outrageous that our policymakers should be embarrassed," said Steve Wamhoff, legislative director at Citizens for Tax Justice, urging Congress to take action to close tax loopholes.

(Reporting by Kevin Drawbaugh and Patrick Temple-West; Editing by Jonathan Oatis)