Paul L. Caron

Tuesday, May 9, 2023

2022 IFA International Tax Student Writing Award; Call For Entrants In 2023 Competition

The winner of the International Fiscal Association's 2022 International Tax Student Writing Competition is: 

International fiscal associationNeil Kelliher (Virginia), Improving Transfer Pricing Litigation by Aligning Section 482 with Litigants’ Incentives, 52 Tax Mgmt. Int’l J. __ (2023).

Faculty Sponsor: Ruth Mason

The Section 482 regulations create a comprehensive system for regulating transfer pricing. But litigation involving these regulations often leads to unsatisfactory results. This issue can be tied to the idea that the section 482 regulations are seemingly written for application by a disinterested third party, while transfer pricing litigation necessarily pits the IRS against a multinational entity. 

This adversarial context exposes weaknesses in the regulations: The same flexibility that enables the regulations to find the best possible pricing of a transaction can create indeterminacy that extends and complicates litigation.

In this paper, I propose three changes to section 482 and its regulations to account for litigants’ disparate incentives. First, I propose strengthening the comparability requirements for the comparable uncontrolled transaction method. Second, I propose updating the best method rule to require mandatory robustness checks for transactions involving intangibles. And third, I propose abrogation of judges’ ability to implement their own method when they are not convinced that either litigant’s method satisfied the best method rule. Each of these proposals will strengthen the existing transfer pricing regime and help ensure efficient and predictable litigation.

2023 IFA International Tax Student Writing Competition
Subject: Any topic relating to U.S. taxation of income from international activities, including taxation under U.S. tax treaties.
Open to: All students during the 2022-23 academic year (including independent study and summer 2023 school courses) pursuing a graduate degree (J.D., L.L.M., S.J.D., M.S.T., MTA, Masters of Taxation, or similar program). Any appropriate papers written in fall 2022 or spring and summer 2023.
Submission Deadline:  September 30, 2023.
Prize: $5,000 cash, plus expenses-paid invitation to the IFA USA Branch Annual Meeting to be held in 2024 for the competition winner as well as the faculty sponsor. The award winner and the academic institution of the competition winner will each receive a one-year membership in the IFA USA Branch. View the member benefits HERE.

Here are the recent winners:

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