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John is an experienced advocate in federal tax disputes faced by multi-national corporations. He has represented clients in some of the most complex tax litigation in the country. The amounts at stake in federal tax disputes can often be staggering. So big, in fact, that it often seems cases become “too big to settle,” as the positions of the tax authorities and taxpayers are separated by hundreds of millions, and even billions, of dollars. John is adept at bridging this gap, having participated in multiple settlements of multiple disputes in which the dollars at stake reached into ten digits.

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Hold on a second. Cost sharing is a tax shelter? For over five decades, cost sharing has been a transfer pricing structure endorsed by Congress, regulated by Treasury and the OECD, agreed to by the IRS and foreign tax authorities alike, and widely embraced by taxpayers. How can it be a “tax shelter”? And yet that is precisely the headline from a recent district court decision in the Western District of Washington.

How did this happen? Is it right? And should we, as taxpayers, be worried about the reach of this holding somehow expanding to other tried-and-true vehicles similarly embraced by the tax law?
Continue Reading Cost Sharing Is a Tax Shelter Now. Wait, What?

The IRS recently released informal guidance in the form of “Frequently Asked Questions” discussing its “observations of best practices and common mistakes in preparing transfer pricing documentation” under section 6662. Particularly right now, as many taxpayers find themselves in the throes of drafting and updating annual transfer pricing documentation reports, a review of these FAQs can provide critical insights into the IRS’s thinking that may improve the efficiency of future audits.
Continue Reading New IRS FAQs on Section 6662 Transfer Pricing Documentation Discuss Best Practices