ABA Panelists Explore Cost Sharing After Veritas, Xilinx Rulings

Panelists at the American Bar Association tax section’s May 7 meeting explored the cost sharing landscape in the wake of two recent court rulings against the Internal Revenue Service, discussing what taxpayers can expect on audit, in Appeals, and in the Advance Pricing Agreement Program after the Veritas and Xilinx decisions.

Both cases involved related parties in Ireland. Veritas Software Corp. v. Comr., 133 T.C. No. 14, concerned the buy-in for intangibles transferred to the affiliate, and Xilinx Inc. v. Comr., 9th Cir., No. 06-74246, involved the cost sharing of stock options with the affiliate. In both cases, the court rejected IRS approaches that were set forth in regulations issued after the years in dispute (18 Transfer Pricing Report 843, 12/17/09; 18 Transfer Pricing Report 1161, 3/25/10). Enjoying this article? To continue reading you need to take out a FREE trial to the Transfer Pricing Library.




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