Procedural Tools that Should be Considered in an International Tax Audit of a Multinational Corporation

Procedural Tools that Should be Considered in an International Tax Audit of a Multinational Corporation

Tax Law
By Anthony Diosdi An exam of a multinational’s tax return(s) will begin much the same manner as any other audit in that the taxpayer will receive a letter from the Internal Revenue Service (“IRS”) notifying it of the audit. However, unlike a typical audit, the examiner will likely be specially trained to deal with issues involving controlled foreign corporations, cross-border transfers and reorganizations, transfer pricing, calculation of foreign tax credits, utilizing bilateral tax treaties, and the branch profits tax. Given the extraordinary complexity of these international provisions, special procedural issues may arise in multinational corporate audits that will not typically arise in an audit of an individual taxpayer or small business. This article explores the special procedural tools that are unique to an IRS examination of a multinational corporation and…
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