Tag: CSA regs

US Treasury regulations governing Cost Sharing Arrangements, setting rules for how multinationals allocate intangible development costs and buy-in payments across related parties. Authorities frequently challenge platform contribution transactions, stock-based compensation inclusions, and valuation of transferred intan.

US vs. Amazon, March 2017, US Tax Court, Case No. 148 T.C. No 8

US vs. Amazon, March 2017, US Tax Court, Case No. 148 T.C. No 8

/ Cost Contribution Arrangements, Digital Economy, Intangibles - Goodwill Know-how Patents, Tax Avoidance Schemes, Transfer Pricing Methods, Valuation - DCF and CUT/CUPs, Akin to a sale, CCA/CSA, Cost Sharing Arrangement (CSA), CSA regs, CUT method, DCF model, Delaware, Discounted Cash Flow (DCF), Indefinite useful life, Ireland, Luxembourg, Platform Contribution Transaction (PCT), Pre-existing intangibles, Relief from royalty method, Stock-based compensation, Terminal value, Useful life, Valuation
Amazon transferred technology IP, marketing IP, and customer lists to its Luxembourg European headquarters via a cost-sharing arrangement in 2005–2006, setting the buy-in payment at $254.5 million. The IRS challenged this, demanding $3.5 billion by applying a discounted cash-flow model treating the intangibles as having indefinite useful lives. The US Tax Court ruled mostly in Amazon's favour in 2017, rejecting the IRS valuation approach ... Read more