Elizabeth Stevens Weighs in on the IRS Finalizing a Record Number of APAs in Law360

The IRS finalized a record number of advance pricing agreements in 2023, signaling the agency's increased effectiveness at completing accords at a time when its approach to transfer pricing litigation could fuel corporate taxpayers' urgency for seeking APAs.

. . .

Because APAs generally last for five years, the closures in 2023 probably include some renewals of India APAs that were initially sought after the APMA announcement, according to Elizabeth Stevens, a member of Caplin & Drysdale. It's positive to see that the program has made such progress with a tough treaty partner, she said.

"That they were able to close so many cases with a pretty tough partner across the table really says something about the success of the program in the last year," Stevens said.

. . .

In a similar vein, Stevens said the success the IRS has had with litigation could drive more companies to seek APAs — particularly unilateral ones, where the risk is perceived to be in the U.S. The big successes that the IRS has had are with respect to U.S.-parented multinational corporations, she said.

For Stevens, an increase in unilateral APA applications "would signal concern with risk in the United States."

To view the full article, please visit Law360's website (subscription required).