Jim Fuller, Adam Halpern
Under the Trump administration, the Treasury Department has undertaken a review of all tax regulations issued since January 1 2016. Two of the Obama administration regulations have since been delayed in their implementation, as further described below. More significant changes likely will be forthcoming, including, possibly, outright withdrawal of some of these rules.
This has given rise to a period of some uncertainty. These regulations contain important, and highly controversial, new rules.
Treasury and the IRS finalised, without any substantive changes, the § 367(a) and (d) regulations proposed in September 2015. The final regulations eliminate the favourable treatment for foreign goodwill and going concern value that had been in effect under the prior regulations for over 30 years. Intangible property, including foreign goodwill and going concern value, no longer qualifies for the active trade or business exception to § 367(a). The specific § 367(d) exception for foreign goodwill and going concern value has been eliminated. The final regulations apply retroactively to outbound transfers occurring on or after September 14 2015, the date the proposed rules were issued.
In adopting these new rules, Treasury and the IRS ignored the very clear legislative history, the relevant statutory language, numerous written comments, and testimony at the hearings. In the preamble to the final regulations, Treasury and the IRS discussed and rejected virtually every taxpayer comment or suggestion regarding the proposed regulations.
Temporary regulations issued under § 721(c) address certain outbound transfers to partnerships. The regulations implement the rules announced in Notice 2015-54, with certain changes. They are intended to ensure that, when a US person contributes certain property to a partnership with related foreign partners, the income or gain attributable to the appreciation in the property at the time of the contribution will be taken into account by the US transferor, either immediately or over time.
Treasury and the IRS also finalised the § 385 regulations and included certain of the § 385 rules in temporary regulations. The final regulations "reserve" on their application to foreign debt issuers (i.e., their application to outbound taxpayers). Thus, they do not apply when a US parent company makes a loan to its foreign subsidiary (controlled foreign company; CFC), or when one CFC makes a loan to another CFC. It was this area of the proposed rules that caused the most problems from an international tax perspective. We (Adam) testified on this very point at the IRS hearings. Foreign tax credits could have been lost and other serious collateral damage would have resulted.
The rules thus apply primarily to US subsidiaries in foreign-parented multinational groups (i.e. inbound taxpayers). Under the final regulations, the documentation requirements of Treas. Reg. § 1.385-2 were slated to have a delayed effective date, applying to debt instruments issued (or treated as issued) on or after Januaruy 1 2018. Recently issued Notice 2017-36 further delayed the effective date to January 1 2019.
The final regulations largely retain the so-called 'blacklisted transactions' rules of Treas. Reg. § 1.385-3, including the per se funding rule causing a debt issued within 3 years of a distribution, stock acquisition, or certain reorganisations to be treated automatically as equity. The retroactive effective date of April 5 2016 is also retained. A number of changes were made to the blacklist rules in response to comments. These changes offer some relief but also add substantial complexity to the rules.
Treasury and the IRS finalised the § 956 regulations relating to partnerships, Treas. Reg. § 1.956-4. Under one rule, a CFC partner is treated for § 956 purposes as holding its attributable share of partnership property, determined in accordance with the partner's liquidation-value percentage with respect to the partnership. Thus, for example, if the partnership makes a loan to a related US person, a CFC partner is treated as holding a percentage of the loan, resulting in a § 956 investment.
Another rule generally treats an obligation of a foreign partnership as an obligation of its partners for the purposes of § 956. This is perhaps the most important part of the new § 956 partnership regulations. If a CFC lends to a foreign partnership in which the CFC's US parent company is a partner, the CFC will be treated as holding an obligation of a US person, again resulting in a § 956 investment. If the partnership distributes the borrowed funds to the US parent company, the amount of the § 956 investment can be increased.
Treasury and the IRS finalised the 2006 proposed § 987 regulations, generally adopting the proposed regulations' substantive approach, with changes at the margins. The final rules are exceedingly complex and are likely to be challenged as they clearly contradict the statutory mandate in certain respects.
Treas. Reg. § 1.987-3 generally requires a branch to compute its taxable income by translating each item of income, gain, loss, and deduction from its currency to the owner's currency. Certain items are translated at current exchange rates, others at historic rates. This scheme runs directly counter to the statute, which provides for calculation of branch income in the branch's currency, and a simple translation into the owner's currency at a single rate.
Treas. Reg. §§ 1.987-4 and 1.987-5 apply when a branch makes a remittance back to the home office. These regulations apply the foreign exchange exposure pool (FEEP method) to determine § 987 gain or loss in such a case, taking into account currency fluctuations in financial assets (but not hard assets or stock in subsidiaries) since income was earned by, or assets were contributed to, the branch. When a branch experiences a "termination," it is deemed to have made a remittance of all of its assets and liabilities to the home office, resulting in full recognition of the currency gain or loss inherent in the FEEP.
The final regulations become effective in 2018. There are important transition rules for companies that need to switch to the final rules from their current method of applying § 987.
Treasury and the IRS finalised the 2015 temporary and proposed § 871(m) regulations addressing certain dividend equivalent transactions, for example, a notional principal contract linked to dividends and share price of a particular US corporate stock. Consistent with Notice 2016-76, the final regulations were to apply to contracts with a delta of one (i.e., 100% of the contract value is determined by reference to the underlying securities) beginning in 2017 and to other applicable contracts beginning in 2018.
In Notice 2017-42, Treasury and the IRS delayed the implementation date for non-delta-one contracts to January 1 2019. The lenient enforcement standards of Notice 2016-76 for taxpayers making a good faith effort to comply were also extended. They will apply in 2017 and 2018 for delta-one contracts, and in 2019 for non-delta-one contracts.
Expectations for fundamental US tax reform were high after the 2016 presidential election. It was anticipated that a Republican president and a Republican-controlled Congress could work together to enact meaningful reforms to the outdated US international tax system.
As of early September 2017, prospects for fundamental reform have dwindled. House Republican leaders spent the first half of the year promoting their "Blueprint" which included a border adjustability tax (BAT) – similar to a VAT on imported goods, services and intangibles. Importers organised strong opposition to the BAT, and House leaders finally relented, but only after substantial time was lost.
Recent tax proposals from the Trump Administration and congressional leaders seem to be focused on a temporary reduction in corporate and individual rates. An optional repatriation holiday has also been mentioned, along the lines of § 965 from the 2004 Tax Act.
In a development that surprised most taxpayers and tax advisers, the IRS appealed the Tax Court's decision in Medtronic v. Commissioner, T.C. Memo No. 2016-112 (2016), a major transfer pricing case in which Medtronic won a resounding victory.
The IRS contends that the Tax Court erred as a matter of law in adopting Medtronic's transfer pricing method. The Service also contends that the case should be remanded so that certain adjustments may be made to the transfer price adopted by the Tax Court.
The Service asserts that the Tax Court's transfer pricing analysis was wrong as a matter of law because it used a royalty rate as a comparable price for Medtronic's inter-company licenses without first applying the requirements for evaluating whether the relevant agreement qualified as a comparable uncontrolled transaction (CUT).
The government seems to have an uphill battle in pursuing this appeal. It likely will have to establish that the Tax Court made a "clear error" regarding its findings of fact despite its "errors of law" assertions. This is a hard standard to satisfy. The IRS brief articulates the IRS's disagreement with the Tax Court's opinion, but it doesn't seem to establish clear error.
The IRS keeps fighting in the courts regarding transfer pricing issues, but doesn't seem to listen to the pretty clear opinions of these courts.
The Tax Court ruled in favour of Eaton Corp., agreeing with the company that the IRS abused its discretion by cancelling two advance pricing agreements that Eaton and the IRS had entered into to establish a transfer pricing method for covered transactions between Eaton and its subsidiaries. Eaton Corp. v. Commissioner, T.C. Memo. 2017-147. Eaton appears to be the only taxpayer whose advance pricing agreements (APAs) were cancelled retroactively. The IRS then issued a deficiency notice to Eaton based on an alternative transfer pricing methodology.
The IRS argued that it cancelled the APAs for two reasons: (1) misrepresentations, mistakes as to a material fact, and failures to state a material fact during the APA negotiations; and (2) implementation and compliance. The Tax Court disagreed with this IRS argument, and held that only a mistake as to a material fact or a failure to state a material fact is a ground for cancellation, based on Rev. Proc. 96-53, § 11.06(1), and Rev. Proc. 2004- 40, § 10.06(1). Under Rev. Proc. 96-53, 1996-2 C.B. 375, in order to cancel an APA, the material fact must be one that, if known to the IRS, could reasonably result in a significantly different APA (or no APA at all).
The Tax Court held that the cancellation of an APA is a rare occurrence and should be done only when there are valid reasons that are consistent with the revenue procedures. A misrepresentation has to be false or misleading, usually with the intent to deceive, and must relate to the terms of the APA. The Tax Court stated that a different viewpoint is not the same as a misrepresentation and is not grounds for terminating an APA. The Court said an APA is a binding agreement and should only be cancelled according to the terms of the revenue procedures and should not be cancelled because of a desire to change the underlying methodology of a transfer pricing method.
The Tax Court held that based on all the evidence presented, no additional material facts, mistakes of material facts, or misrepresentations existed that would have resulted in a significantly different APA or no APA at all. The IRS had enough material to decide not to agree to the APAs or to reject Eaton's proposed transfer pricing method and suggest another APA at the time the APAs were negotiated.
While the issue was framed differently, the Eaton case bears conceptual similarities to Medtronic (above) and Eli Lilly v. Commissioner, 856 F.3rd 855 (7th Cir. 1988), in that each of these three cases involved § 482, a prior transfer pricing agreement between the taxpayer and the IRS, and the IRS's subsequent decision not to follow the agreement and to assert large tax deficiencies. All three cases were lost by the IRS. In all three, the courts' transfer pricing results were effectively those to which the IRS and the taxpayer had previously agreed, with some minor changes.
The Tax Court decision in Amazon.com Inc. v. Commissioner, 148 T.C. No. 8 (2017), was yet another transfer pricing taxpayer victory. The court rejected the IRS's attempt to relitigate the same cost-sharing transfer pricing issues the IRS lost on in Veritas Software Corp. v. Commissioner, 133 T.C. 297 (2009).
The Tax Court stated that one does not need a Ph.D. in economics to appreciate the essential similarity between the discounted cash flow (DCF) methodology used by the IRS's expert in Veritas, and the DCF methodology used by the IRS's expert in Amazon. Both assumed that the pre-existing intangibles transferred had a perpetual useful life; both determined the buy-in payment by valuing into perpetuity the cash flows supposedly attributable to these pre-existing intangibles; and both in effect treated the transfer of pre-existing intangibles as economically equivalent to the sale of an entire business.
The Tax Court rejected the Service's aggregation argument in Veritas and it rejected it in Amazon as well. The Tax Court stated the type of aggregation proposed does not yield a reasonable means, much less the most reliable means, of determining an arm's-length buy-in payment for at least two reasons. It improperly aggregates pre-existing intangibles (which are subject to the buy-in payment) and subsequently developed intangibles (which are not). It improperly aggregates compensable intangibles (such as software programs and trademarks) and residual business assets (such as workforce in place and growth options) that do not constitute pre-existing intangible property under the cost sharing regulations in effect during 2005-2006.
The Service urged the Tax Court to overrule Veritas if it could not be distinguished on the facts. The Tax Court stated: "We decline his invitation to overrule that Opinion".
Analog Devices won an important § 482 transfer pricing case involving Rev. Proc. 99-32, 1999-2 C.B. 296, which authorises procedures to repatriate cash following, and equal to the amount of, a transfer pricing adjustment. The IRS argued unsuccessfully that the deemed accounts receivable under the revenue procedure constituted real and retroactive accounts receivable and payable that could create serious negative tax consequences under other tax provisions, § 965 in the case of Analog Devices.
A previous case, BMC Software v. Commissioner, 141 T.C. 224 (2013) (BMC), was decided against the taxpayer on this issue, but reversed on appeal by the Fifth Circuit, 780 F.3d 669 (2015). An appeal in Analog Devices would lie to the First Circuit, so BMC's appellate victory was not controlling.
In a 'reviewed by the Court' decision in Analog Devices, the Tax Court agreed to follow the Fifth Circuit, thus overruling its BMC decision. Accordingly, the Rev. Proc. 99-32 deemed accounts receivable is just that, artificial and only a procedural mechanism to repatriate the relevant cash.
Grecian Magnesite Mining v. Commissioner, 149 T.C. No. 3 (2017), addressed Grecian Magnesite Mining (GMM), a Greek corporation that had an interest in Premier Chemicals (Partnership), a US limited liability company treated as a partnership for tax purposes. GMM's partnership interest was later redeemed. Part of the gain was subject to tax under FIRPTA (real estate gain) rules, and taxed accordingly. The issue was how the rest of the gain from the redemption of GMM's partnership interest should be taxed.
Under Rev. Rul. 91-32 the gain recognised by GMM would be treated as effectively connected with a US trade or business to the extent the partnership was so engaged. The Tax Court rejected the revenue ruling as not a proper interpretation of the IRS's own regulations, and stated that it lacked the power to persuade the Court. Further, the Court stated that the revenue ruling's treatment of the relevant partnership statutory provisions was cursory in the extreme, and did not even cite § 731, the tax code rule governing "gain or loss from the sale or exchange of a partnership interest".
This holding was not unexpected. Many practitioners had long viewed the revenue ruling as suspect and of questionable validity. It simply ignored the Code's statutory language.
The Court found that the balance of the gain was treated as gain from the sale or exchange of a capital asset based on the plain language of the statute. The Court stated that Congress intended § 741, if applicable, to provide capital gain or loss treatment on the sale or exchange of a partnership interest by a partner. Indeed, stated the Court, congressional use of the phrase "shall be considered as" in § 741 is unambiguous and mandatory on its face.
The IRS argued that the redemption should be subject to US tax anyway. The disputed gain was foreign source income. The Service argued that the gain was taxable under § 865(e)(2)(A) which provides that: "If a nonresident maintains an office or other fixed place of business in the United States, income from any sale of personal property (including inventory property) attributable to such office or fixed place of business shall be sourced in the United States".
The Service argued that the disputed gain was taxable under this exception if the gain was attributed to the Partnership's US office.
The Service's argument had two strands: first, that the Partnership's office was material to the deemed sale of GMM's portion of the Partnership assets; and second, that the Partnership's office was material to the increased value of that interest that GMM realised in the redemption. The Court stated that the material factor test was not satisfied because the Partnership's actions to increase its overall value were not "an essential economic element in the realisation of the income". Increasing the value of the Partnership's business as a going concern, without a subsequent sale, would not have resulted in the realisation of gain by GMM.
Even if the Court were to decide that the Partnership's office was a material factor in the production of the disputed gain (which it did not), the Court stated that it would also need to find that the disputed gain was realised in the ordinary course of the Partnership's business conducted through its office in order for the gain to be attributable to that office, and thereby to be US source income.
The redemption of GMM's interest in the Partnership was a one-time, extraordinary event and therefore was not undertaken in the ordinary course of the Partnership's business. The Court stated that the IRS conflates the ongoing income-producing activities of the Partnership (magnesite production and sale), which certainly occurred in the ordinary course, and the redemption of GMM's partnership interest, which was an extraordinary event. The Court stated that the Service would effectively eliminate the "ordinary course" test and would allow the "material factor" test to stand for both tests.
Much anticipation surrounds the Trump administration's promise to push through tax reforms. Throughout the presidential campaign, Donald Trump pledged to slash corporate income rate, repatriate foreign earnings and increase the standards of deductions. The Republican Party is well-positioned in the grand scheme of legislative change with a majority in both House and Senate.
Douglas Stransky, head of tax at Sullivan & Worcester, said that passing through comprehensive tax reform will likely prove challenging. "If we do not see a bill in the next few weeks, it is very unlikely that we would see tax reform legislation this year because of political pressure and an unforgiving legislative timetable," said Stransky.
Despite the uncertainty that surrounds reform, some practitioners have affirmed that the US tax system will likely be transposed to a territorial tax regime. "Such a system would put the US on parity with most of the rest of the world with regard to how profits earned overseas are taxed," said Stransky.
However, Rocco Femia, tax member at Miller & Chevalier Chartered, stated: "A territorial system could exacerbate the pressure on US transfer pricing rules, as profits shifted outside of the US would escape US tax. This effect could be mitigated by anti-base erosion rules, although the design of such rules should preserve the competitive benefits of territoriality."
While talk of tax reform on a grand scale have dominated the headlines, tax inversion-curbing legislation introduced by the previous administration is also at risk of being reversed.
On July 28 2017, the IRS issued Notice 2017-38, which placed earnings stripping regulation under renewed review and delayed it from coming into effect by 12 months, until January 2019.
The initial rules, legislated by former president Barack Obama, reclassified certain loans as equity under Section 385 of the US tax code and aimed at closing international tax loopholes by asking companies to submit information on related party debt to the tax authority.
Stransky argued that the regulations in this area are complex and impose significant documentation and analysis requirements on US corporations for ordinary inter-company transactions.
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Fenwick & West
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Fenwick & West LLP has represented over 100 of the Fortune 500 largest corporations in tax planning, transfer pricing, acquisitions, joint ventures and tax dispute resolution, including litigation. Well over 50 are Fortune 100 companies.
Our primary focus is in the international tax area. International Tax Review named us in 2017 as having one of the world's leading tax planning and tax transactional practices.
Dispute resolution also is an important part of our tax practice. We have favorably resolved disputes in over 150 IRS appeals proceedings. We also have been counsel to corporate taxpayers in over 70 federal tax court cases. Many of these cases and appeals proceedings involve or have involved transfer pricing.
Eight Fenwick tax partners appear in International Tax Review's Tax Controversy Leaders (2017), and five have appeared in Euromoney's World's Leading Transfer Pricing Advisors.
Euromoney Legal Media Group named Jim Fuller, one of our tax partners, as one of the top 25 tax lawyers in the world. Ten Fenwick partners, including our tax practice group leader, Adam Halpern, have appeared in Euromoney's World's Leading Tax Advisors. Three appear in Euromoney's Top 30 US Tax Advisors (2017).
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Main areas of focus:
Corporate Tax, Mergers & Acquisitions, Transfer Pricing, International Tax & Permanent Establishments, Indirect Tax, Customs, Private Clients, Global Mobility, Tax Controversy, Tax Technology
|Federal corporate income tax rate||35%|
|Royalties from, for example, patents, know-how||30%|
|Branch Remittance Tax||30%|
Keith Kechik and Dan Rahill are managing partners at Alvarez & Marsal, Taxand USA. Kechik has 36 years of experience in the industry. He has advised clients in the areas of structured finance and investments, M&A, disposition strategies, joint ventures, securitisations, leasing and cross-border planning. Rahill advises clients on structuring and compliance, tax outsourcing, tax provision and accounting issues.
Baker McKenzie's multidisciplinary team offers a full range of tax and TP services. The firm's TP practice comprises more than 50 professionals, including Russell Young. Young advises multinationals on TP and international tax issues, including TP compliance.
The firm's client list includes companies in the healthcare, digital and technology, media and telecommunications (TMT) industries.
Key members of the team include partner John McDonald and senior counsel Gregg Lemein.
Deloitte's Chicago office comprises 75 professionals. Darcy Alamuddin is the principal and leader of the central region in the firm's TP practice. Alamuddin consults multinational clients on many aspects of transfer pricing and international taxation. Tom Driscoll is the US managing partner for international tax, transfer pricing and indirect tax. Driscoll's practice focuses on tax-advantaged financing strategies, tax-efficient supply chain structuring, hedging and risk management strategies and repatriation techniques.
Deloitte is one of the largest tax service firms in the US. It offers a broad range of fully integrated tax services that deliver insight, innovation and deep industry experience to companies facing tax issues. Its services include: business tax services, international tax, indirect tax, multistate tax, tax management consulting, global employer services, M&A and private wealth, among other things.
Deloitte offers a number of resources to help clients stay on top of tax issues, including Dbriefs, tax Newsletters and its Tax@Hand app.
Its international tax and TP practice is led by managing partner John Womack and consists of nearly 1,200 professionals.
DLA Piper's Chicago practice offers clients tax and business planning advice in connection with domestic and multi-jurisdictional transactions and investments. The firm's tax practice comprises one partner and two other fee earners, including practice lead Tom Geraghty.
In May 2016, DLA Piper represented two private equity companies in acquisitions worth hundreds of millions of dollars.
The firm's client list includes major multinational corporations, large pension funds, private equity and hedge funds, investment banks and commercial banks, among others.
EY offers services in tax planning, international and corporate tax, state and local tax, transactions, M&A, TP planning and compliance. Mark Mukhtar is the central region international tax services leader. Jonathan Lindroos is the tax leader in the northeast tax service, while Scott Shell leads the southeast practice.
Grant Thornton has 58 offices in 29 states. The firm offers tax, audit and advisory services to clients across a wide range of industries. Jeffrey Frishman is the national managing principal for the firm's tax services group.
David Cavin is the managing director of the firm's corporate strategic federal tax services. Cavin has more than 10 years of experience working with capital markets, construction and manufacturing.
Frishman is also a professor of law at Chicago-Kent College of Law.
Jenner & Block offers services in designing and executing business transactions, securities offerings and other tax advice.
The professionals at the firm are broadly experienced in state, local and federal tax matters. They are also capable of handling transactions relating to spin-offs, partnership investments, public and private securities offerings, restructurings both in and out of bankruptcy and real estate transactions including tax-free exchanges.
Clients of the firm come from all sectors of the economy, including defence manufacturing, financial services, food services, e-commerce and real estate.
Christian Kimball and Geoffrey Davis co-chair the tax practice. Kimball counsels on matters involving federal income tax, specifically relating to M&A; corporate restructurings; and tax controversies. Davis advises on federal tax, focusing on acquisition and divestiture transactions, restructuring and financing transactions, fund formation and related investments.
Katten Muchin Rosenman is a full-service firm. Saul Rudo is the national head of the firm's tax planning practice. His areas of expertise include M&A, venture capital, international transactions and corporate planning. The practice advises on corporate and partnership transactions, controversy and litigation, and coordinates tax, corporate and legal planning for its clients.
Kirkland & Ellis's tax group assists clients with tax planning for complex transactions. The group has a strong international reputation for providing sophisticated tax counselling on US and foreign tax issues. The firm offers services in tax planning in relation to M&A, buyouts, fund formation, restructurings, bankruptcy reorganisations, financings, executive compensation arrangements and other sophisticated transactions. In addition, it assists clients with challenges from the IRS and foreign and state tax authorities.
The firm's tax group comprises 19 partners and 11 other fee earners. Todd Maynes is a senior partner in the Chicago tax practice.
This year, Kirkland & Ellis represented a consortium of more than 30 China-based investors in an agreement to acquire Qihoo 360 Technology Co. Ltd. The deal, led by Mike Carew, was the largest ever leveraged buyout of a Chinese company ($11.3 billion).
In an example of the firm's tax disputes work, Maynes and Natalie Keller are representing Big Sandy Holding Company in pursuing a multi-million dollar tax refund from the IRS attributable to the carryback of losses from Mile High Banks.
KPMG offers a broad range of tax services. The firm comprises more than 1,800 US professionals who handle matters relating to federal, state and local taxes, indirect taxes, inbound investments, international tax, M&A and restructurings.
The firm serves clients in chemical, healthcare, media, retail, technology, telecommunications and banking industries, among others.
David Leiter is the partner in charge of the firm's Chicago tax practice.
The Chicago office of Latham & Watkins is a leader in relation to the tax aspects of renewable energy projects, including wind farms, biomass, geothermal plants and solar projects.
The firm is full service and advises clients in areas including asset-based lending, banking and financing, bankruptcies and restructuring, capital markets and M&A.
Cathy Birkeland is the managing partner of the firm's Chicago office and the global chair of the firm's capital markets practice. Julie Marion is a partner at the firm whose practice concentrates on joint venture investments, business acquisitions and related financing matters.
Joseph Kronsnoble is the chair of the firm's transactional tax practice. Kronsnoble represents public and privately owned companies and buy-out firms in relation to tax-free and taxable M&A, leveraged buyouts, spin-offs and other transactions, including cross-border investments, dispositions and combinations.
Mayer Brown provides tax advice to a broad group of clients, including financial institutions, multinational corporations and investment funds. The firm offers services in tax planning, consulting global reorganisations and restructurings, intangibles and transfer pricing, among other things.
The team comprises 13 partners and 13 other fee earners, including co-heads Jim Barry, Tom Kittle-Kamp and Joel Williamson.
This year, Mayer Brown represented Tribune Media Company, Chicago Baseball Holdings and Northside Entertainment Holdings in cases contesting proposed deficiencies in tax of $181.7 million and proposed penalties of $72.7 million.
The firm also assisted Boston Scientific Corporation in resolving one of the largest and most complex TP disputes docketed in the Tax Court. The matter, which six of the firm's practitioners worked on, involved asserted transfer pricing adjustments totalling $3.5billion
Barry is a key member in the firm's tax practice. He has represented a wide variety of major companies in M&A, financings and other matters. He is also the chair of the University of Chicago Tax Conference.
McDermott Will & Emery has one of the most diversified state and local tax practices in the US. Its Chicago office is led by Lowell Yoder, whose practice centres on cross-border M&A, global tax planning and international tax controversies. He also advises on tax-efficient structuring of cross-border acquisitions, dispositions, financings, internal reorganisations and joint ventures.
The firm is full service and advises Fortune 100 companies. Its client list includes companies from industries such as manufacturing, food, fast-moving consumer goods (FMCG) and agriculture, energy and utilities and computers and digital.
Two key members of the firm's tax team are partners Michael Fayhee and Kevin Feeley.
Scott Bakal and John Biek co-chair Neal, Gerber & Eisenberg's tax group. The firm offers services in transactional tax planning, tax controversy and state and local taxation. The practice employs five partners and one associate.
Bakal assists entrepreneurial companies and high-net-worth individuals involved in cross-border operations. Biek has represented large corporations involved in controversies relating to multi-state corporate income/franchise taxes, gross receipts taxes and sales and use taxes, among other things.
PwC's US tax department advises on state and local taxes, tax accounting, tax controversy, international tax, regulatory process and tax credits, among other things. Mark Mendola is the vice chairman and the US managing partner of PwC. Mendola also serves as the senior relationship partner to several of the firm's largest clients. Michael Shehab is the leader for the US tax technology, compliance and sourcing practice.
The professionals at RSM work with companies large and small, across various industries including manufacturing and wholesale distribution, private equity and finance. The practice is led Jeff Johannesen, who has been with the firm since 1981. Johannesen is also the national tax leader. His practice focuses on assisting clients with planning and structuring purchases, sales of businesses, reorganisation and restructuring, tax planning and representation before the IRS.
The firm offers various services to clients including accounting; tax consulting and compliance; state, local and international tax consulting; risk management consulting; and transaction support.
Sidley Austin's is a well-respected law firm in Chicago. Practitioners at the firm offer advice on a broad range of litigation, transactional and regulatory matters.
Sharp Sorensen is co-leader of the firm's national tax practice and heads the firm's tax practice in Chicago. He focuses on federal tax matters, including M&A, spin-offs, securitisations and other asset-based financings, joint ventures, leveraged leasing and regulated investment companies.
Partner Karen Hayes also specialises on federal income tax matters. Hayes has advised corporations, partnerships and private equity funds in relation to M&A, divestitures, spin-offs, partnerships and joint ventures.
David Polster oversees the tax practice at Skadden, Arps, Slate, Meagher & Flom. The firm offers a range of transactional, litigation and regulatory services to local, national and international clients.
The firm comprises four partners and 19 other tax professional, including Luke Maher, Lea Malewitz and Michael Rizza who joined the firm in 2016.
This year, the firm represented Fortress Investment Group (a global investment firm managing around $70 billion in assets) in its acquisition by SoftBank Group Corp.
It also advised American Capital on two transactions valued at more than $4 billion, including the largest-ever business development company merger.
Linda Coberly is the managing partner of Winston & Strawn's Chicago office.
The firm's professionals are experienced in M&A, federal tax planning, state and local taxes and tax transactions. The team also assists clients in litigation at all levels of the administrative and judicial branches.
Coberly's practice centres on appeals and complex commercial lawsuits before the courts.
|Tier 1 - US: Chicago|
|Kirkland & Ellis|
|McDermott Will & Emery|
|Skadden, Arps, Slate, Meagher & Flom|
|Tier 2 - US: Chicago|
|Latham & Watkins|
|Winston & Strawn|
|Tier 3 - US: Chicago|
|Jenner & Block|
|Katten Muchin Rosenman|
|Tier 4 - US: Chicago|
|Alvarez & Marsal, Taxand USA|
|Neal, Gerber & Eisenberg|