An IRS legal memo on the agency’s ability to adjust a company’s profits continues to come up in audits of companies’ transfer pricing, an IRS official said Wednesday.
“It’s not a one-off,” said James Kelly, deputy associate chief counsel for international, after speaking on a panel at a Texas Federal Tax Institute conference in San Antonio. “The issue is being evaluated for taxpayers under audit.”
The January 2025 generic legal advice memo, known as a GLAM, strengthened the IRS’s ability to use the commensurate-with-income standard to assert periodic adjustments when actual profits from transferred intangibles like intellectual property turn out ...