9th Circ.'s Revival Of IRS Rules Stretches 'Arm's Length'

Law360 (June 13, 2019, 8:38 PM EDT) -- The Ninth Circuit's split decision to uphold cost-sharing rules challenged by chipmaker Altera Corp. gives the Internal Revenue Service wiggle room in deciding what counts as arm's length among related businesses — and casts doubt on the long-standing approach to transfer pricing.

Last week the Ninth Circuit upheld the Internal Revenue Service's analysis of payments made to the chipmaker Altera Corp. by a Cayman Islands subsidiary, overturning a 2015 ruling by the U.S. Tax Court. (AP) Last week, a 2-1 majority on a Ninth Circuit panel overturned the U.S. Tax Court's ruling for Altera. In doing so it reinstated a 2003 regulation that required...

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