• Service: Tax, Global Transfer Pricing Services, International Tax
  • Type: Regulatory update
  • Date: 12/3/2013

United States - Analysis of proposed competent authority, APA guidance 

December 3:  The IRS in late November 2013 released two notices (Notice 2013-78 and Notice 2013-79) containing draft revenue procedures providing guidance and instructions with respect to requesting competent authority (CA) assistance and advance pricing agreements (APAs).

The long-awaited draft revenue procedures represent substantial changes from the current 2006 revenue procedures, and are consistent with the objectives of the Advance Pricing and Mutual Agreement Program (APMA)—i.e., the IRS department that handles CA and APA matters—to enhance integration between CA matters and APAs and to increase transparency and efficiency in these processes.

Overall, tax professionals welcome these proposed changes because they are expected to improve the efficient allocation of resources on the part of taxpayers and APMA alike and to provide enhanced clarity to taxpayers about CA and APA processes. Most significantly, perhaps, they reflect an interest by APMA to work with taxpayers to try to address proactively, through the CA and APA processes, cross-border controversies arising within the U.S. income tax treaty network. In an environment where these transfer pricing controversies are increasing in number every year, the IRS is committed to making dispute resolution mechanisms more effective.

Read a December 2013 report [PDF 216 KB] prepared by KPMG LLP.

Contact a tax professional with KPMG's Global Transfer Pricing Services.

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