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Jason M. Osborn

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Jason Osborn is a Tax partner in the firm’s Washington DC office. He provides sophisticated transfer pricing and international tax advice to multinational clients in wide range of industries, including financial institutions, pharmaceuticals, chemicals, software, automotive, consumer products, energy and transportation.

Jason re-joined Mayer Brown in 2013 after holding transfer pricing-related positions with Internal Revenue Service (“IRS”) from 2008-2012, initially as a team leader in the Advance Pricing Agreement (“APA”) Program and subsequently as a manager in the transfer pricing branch of the Office of Associate Chief Counsel (International). Leveraging this IRS experience, Jason brings to the table a unique and insider’s perspective in advising clients on complex transfer pricing matters and negotiating APAs. Prior to his IRS service, Jason was a senior Tax associate at Mayer Brown focused on transfer pricing matters.

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On March 23, 2021, the United States’ Advance Pricing and Mutual Agreement Program (“APMA Program”) released its 2020 annual report (“2020 Annual Report”) to the public concerning advance pricing agreements (“APAs”). COVID-19 has caused unprecedented disruptions  to taxpayers and tax administrations alike, but the 2020 Annual Report shows that the APMA Program remained highly productive in 2020. Last year taxpayers filed 121 APA requests—the same amount as in 2019. And in 2020, APMA executed 127 APAs—seven more than the prior year.
Continue Reading APMA to COVID-19: Don’t Stop Me Now

Consider the following hypothetical: Researchers at a US-parented drug company develop an artificial intelligence (or “AI”) system that can identify new therapeutic targets with minimal human intervention. The drug company sells the system to its foreign affiliate in a lower-tax jurisdiction. What is the appropriate valuation of the system on this outbound transfer (e.g., based on the cost to create it or based on the value of the IP it is likely to generate)? And, when the AI system later successfully creates a new therapeutic, which entity will be entitled to the non-routine returns from sales of the therapeutic: the US parent that developed the system, the foreign subsidiary that owns the system that developed the therapeutic, or some combination of both?
Continue Reading Transfer Pricing for AI-Generated Intellectual Property

The Mutual Agreement Procedure (“MAP”) is a useful dispute resolution mechanism for multinational companies facing a transfer pricing or other assessment resulting in double tax, whether in the U.S. or abroad. In order to fully avail themselves of the advantages of the MAP process, taxpayers should pay careful attention to the applicable procedures to optimize their chances of a successful resolution.
Continue Reading The Mutual Agreement Procedure (“MAP”): Advantages and Potential Pitfalls for Resolution of Double Tax Issues

Coronavirus economic impact

Just in time for the holidays, the OECD has published detailed guidance about the impact of the COVID-19 pandemic on transfer pricing. The guidance has useful information for taxpayers and tax administrations alike. It contains general advice on the application of basic transfer pricing principles during the pandemic, as well as specific advice on four issues: (i) comparability analyses, (ii) allocating losses, (iii) government-assistance programs, and (iv) advance pricing arrangements (“APAs”). The OECD guidance is broadly consistent with comments we made in a prior post about the impact of the pandemic on transfer pricing.
Continue Reading OECD Guidance on Pandemic’s Impact on Transfer Pricing

Colliding of two Quasars galaxies with Black Hole in centrum

Last week, the IRS issued new guidance that addresses “telescoping” in mutual agreement procedure (“MAP”) and advance pricing agreement (“APA”) cases. Very generally, the guidance disallows (subject to a $10 million materiality exception) telescoping for tax years starting in 2018, when the Tax Cuts and Jobs Act (“TCJA”) came into effect, while continuing to allow telescoping for pre-2018 years in appropriate cases. According to the IRS’s Advance Pricing and Mutual Agreement (“APMA”) program, the new guidance was needed to address the impact of the TCJA “and its many interlocking provisions that require careful determination (and redetermination, as needed) of a U.S. taxpayer’s taxable income and tax attributes.” The new guidance has the potential to drive up compliance costs by increasing the number of tax returns that taxpayers must file to resolve MAP and APA resolutions for post-TCJA years (and resolutions spanning both pre- and post-TCJA years).
Continue Reading Telescoping into the Void

Man teleworking wearing shirt, tie and pajama pants

COVID-19 has sparked a seismic change in the workplace as many companies have found that working from home (“WFH”) has not diminished employee productivity and that employees prefer its greater flexibility. Given that—and the potential for saving on overhead costs—many companies have announced plans to adopt long-term WFH policies and close or realign office space. The OECD and several countries including the US, UK, Ireland, and Australia have issued guidance that excepts employees temporarily dislocated outside their employer’s country from creating unintended permanent establishments (“PE”)—but long-term WFH employees are not similarly excepted. The US, in particular, has thus far only officially extended PE protection for temporary dislocations of up to 60 calendar days that begin within the emergency period of February 1, 2020 through April 1, 2020.

While many employees that WFH do so from the same country as their employer, that is not always true, and so companies would be wise to perform their due diligence. To that end, this post analyzes some PE issues that a company should consider before it adopts a long-term WFH policy.Continue Reading Work-From-Home Policies in the Post-COVID Era

On September 1, 2020, the IRS issued final regulations regarding the base erosion and anti-abuse tax (“BEAT”) codified in IRC §59A. These regulations finalize the proposed BEAT regulations published on December 6, 2019 with certain refinements. Among other guidance, the final BEAT regulations provide detailed rules that allow corporate taxpayers to waive deductions for purposes of BEAT. Although waiving deductions will likely result in additional tax costs, the waiver election may be an easier and less costly solution than the alternative of making substantive business model or supply chain changes to mitigate BEAT.
Continue Reading Waiving BEAT Deductions – The Smart Election for Multinational Taxpayers?

Responding to the potential disruption created by COVID-19 for transfer pricing arrangements, the Advance Pricing & Mutual Agreement (“APMA”) Program on May 11, 2020, issued informal guidance related to the pandemic. The guidance makes clear that APMA will consider the impact of COVID-19 on both pending requests and completed agreements. It also reveals that APMA is already discussing COVID-19 issues with treaty partners.
Continue Reading COVID-19 and APAs: APMA Signals Flexible Case-by-Case Approach to Address Special 2020 Transfer Pricing Challenges in APAs