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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|Federal corporate income tax rate||35%|
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Alston & Bird's New York office assists a number of prestigious Wall Street institutions and leading publicly traded and privately held entities with a range of tax matters. The firm has more than 100 lawyers, who are well versed in complex commercial transactions.
The firm offers services in employee benefits and executive compensation, federal and international tax, state and local tax, tax controversy, tax policy and regulation, transfer pricing and wealth planning.
Albert Liguori is the managing director at Alvarez & Marsal, Taxand USA. The firm provides a range of transactional and advisory tax services to national and international clients. The New York team has expertise in cross-border income tax, state and local tax and representation before the IRS and state tax authorities.
Liguori has more than 20 years of international tax and accounting experience and has frequently helped companies respond to tax demands from boards of directors and shareholders.
Baker McKenzie's New York practice comprises 36 professionals, including chairman emeritus Eduardo Leite. Shanwu Yuan is the firm's international tax director. He assists large multinational enterprises with operations in China and elsewhere on various transfer pricing issues, including APAs and MAPs.
The firm offers services in customs, real estate tax, state and local tax, supply chain tax planning, tax dispute resolution, M&A, reorganisations, tax planning, tax policy, transfer pricing, VAT, indirect tax and wealth management.
Linda Swartz is the chair of Cadwalader, Wickersham & Taft's tax group. The firm has a strong transactional practice that specialises in complex domestic and cross-border deals, resolution of special tax issues and tax controversy.
The firm's tax lawyers are recognised for their results-oriented approach and expertise in US and UK tax law. The team represents domestic and multinational corporations, private equity and other investment firms and investment banks in transactions that involve extensive analysis and innovative deal structuring.
Cleary Gottlieb Steen & Hamilton is internationally known for its strong tax practice. The tax group provides clients sophisticated advice in tax planning, tax strategies, cross-border matters and tax controversies.
The tax group works closely with its international offices to provide effective solutions to multinationals, financial institutions, investment funds, governments and individuals. The firm's services include assistance in obtaining governmental rulings in various countries, cross-border direct investments, domestic and multinational M&A, joint ventures and start-ups, derivatives and international capital markets.
James Duncan is a partner in the New York office. Duncan assists clients with public and private acquisitions, restructurings and joint ventures and tax planning for financial companies among other things.
Another member in the team includes James Peaslee. Peaslee has significant experience guiding clients in major transactions, including capital markets financings, M&A and joint ventures. He is also the author of various books and articles on tax.
Clifford Chance provides services in M&A, joint ventures, stamp duty, VAT, international tax and domestic tax. Its tax team advises clients on large and complex debt and equity market transactions, as well as securitisations, capital markets and derivatives.
The New York office has 14 professionals, six of whom are partners.
Partner Richard Catalano focuses on general tax law with an emphasis on partnership and corporate tax planning and the taxation of real estate collective investment vehicles. Avrohom Gelber's practice focuses on cross-border finance and capital markets transactions.
Cooley has a team of more than 25 lawyers who specialise in US federal, state, local and international tax.
The team comprises two professors of tax law and a former deputy tax legislative counsel for the office of tax policy for the Treasury Department.
Clients of the firm include Adobe Systems, HSBC Bank, MetLife, Shell Oil Company, Starwood Hotels and Verizon Communications.
Kathleen Pakenham co-chairs the tax practice group. Pakenham is experienced in federal tax law and procedure, pre-litigation assessment phases. She has represented clients in all types of internal and governmental investigations.
Cravath, Swaine & Moore is a full-service law firm recognised for its strong expertise in tax. The firm advises domestic and international transactions and has assisted clients with tax-efficient structures including, M&A, spin-offs and joint ventures.
The team also advises on the tax aspects of capital markets, banking and credit transactions.
Cravath, Swaine & Moore has seven partners, among these Lauren Angelilli and Christopher Fargo, who are experienced in the tax and structuring aspects of M&A, spin-offs, restructurings and joint ventures.
Michael Schler sits as counsel in the firm's tax group. His expertise includes corporate tax, corporate finance including structured finance and securitisations, M&A and international transactions. Schler is also a member of the American College of Tax Counsel and the chair of the New York tax forum.
Peter Glicklich is the managing partner at Davies Ward Phillips & Vineberg's New York office.
The firm has an integrated Canadian and US tax practice comprising 33 members. The team provides services in corporate and international tax planning, REITs, M&A, transfer pricing, personal tax planning and executive-compensation arrangements, sales tax, dispute resolution and litigation.
Davis Polk & Wardwell has offices in Brazil, China, France, Japan, Spain, the UK and the US. The firm is known for strong expertise in M&A, capital markets, spin-offs, private equity, real estate and controversy.
Its New York office works on the full spectrum of domestic and international transactions and has been part of many of the most significant business and legal developments in the country. The firm's tax practice comprises 45 professionals, including practice lead Neil Barr. Barr advises clients on federal income tax matters, including domestic and cross-border M&A, joint ventures and spin-offs.
Avishai Shachar is the chairman at Davis Polk & Wardwell's tax practice. Shachar's practice centres on M&A, spin-offs and financial products.
The tax practice at Debevoise & Plimpton comprises 36 professionals, nine of which are partners.
Debevoise & Plimpton is a leading firm in the market. The team works with clients on matters relating to M&A, international transactions, private equity and hedge fund formations, joint ventures, bankruptcies and restructurings, public and private financings and real estate transactions.
Peter Furci and Peter Schuur co-chair the firm's global tax practice. Furci specialises in M&A, investment fund formation and general corporate transactions.
Schuur specialises in US and cross-border M&A transactions, with a focus on the insurance industry. He also has extensive experience advising clients on the structuring and formation of investment funds and international investment platforms.
The firm's clients come from industries such as private equity, insurance, banking, airlines, technology, media and pharmaceuticals.
Deloitte's 70,000 professionals work in four key business areas: audit, advisory, tax and consulting. The firm's US practice is one of the largest in the country and provides fully integrated tax services in the areas of business tax, international tax, transfer pricing, indirect tax, multistate tax, tax management consulting and M&A.
John Womack is the US managing partner for international tax, transfer pricing and indirect tax. Womack has 28 years of experience serving clients with a particular focus on US-based multinationals in various industries including heavy manufacturing, life sciences and retail.
Clients of the firm come from the technology, telecommunications, national security, health and media and entertainment sectors.
The New York tax practice of DLA Piper has a varied list of clients in the US and across the globe. The firm provides tax and business planning advice and dispute resolution representation on all federal, state and local matters. Its practitioners have significant experience providing sophisticated tax advice to clients in many sectors, such as sports and media and insurance and asset management.
Kathy Keneally is the chair of the firm's civil and criminal tax litigation practice, while Gerald Rokoff co-chairs the transactional tax practice
This year, the firm has advised the Los Angeles Chargers in connection with its team's relocation and agreement to participate in the development and financing of the $2.66 billion NFL stadium. It also assisted Fosun with the global tax work relating to the sale of Ironshore to Liberty Mutual.
Global firm EY assists clients on a broad range of tax matters. The firm offers services in tax planning, international and corporate tax, state and local tax, transactions, M&A, transfer pricing planning and compliance. Jonathan Lindroos leads EY's practice in the northeast region.
Robert Scarborough and Claude Stansbury oversee the tax practice at Freshfields Bruckhaus Deringer. The firm has two partners and five associates, who have extensive knowledge and industry experience in mature and developing markets. The firm has a global outlook with offices across Europe, the Middle East and Asia.
Members of the firm regularly publish articles in legal magazines and other publications.
Fried, Frank, Harris, Shriver & Jacobson represents some of the leading corporations and financial institutions in all areas of tax law. Its services include M&A and dispositions, spin-offs, and joint ventures.
The firm regularly advises domestic and foreign corporations and partnerships on various tax matters and has worked with major investment banks.
Robert Cassanos is the chair of the tax department in New York and is seasoned in cross-border taxation. Cassanos has counselled on various matters including public and private M&A, leveraged buyouts, cross-border acquisitions, joint ventures, fund formations, financings and REITs.
Jones Day offers a full range of legal services to local, national, and global clients in the areas of bankruptcy tax, international tax, M&A, private equity and real estate, state and local tax, structured finance, tax audits and controversies and tax credit transactions.
The firm comprises 13 professionals, including practice leader Edward Kennedy. Kennedy has extensive experience in all aspects of federal and international taxation, including M&A, debt instruments and derivatives, foreign currency, subpart F planning and cross-border structured finance.
Kirkland & Ellis is a highly respected firm that offers tax planning in relation to complex transactions. Its tax group has a strong international reputation, providing sophisticated tax counselling on US and foreign tax issues.
The firm's practice specialises in tax planning in connection with domestic and foreign M&A, buyouts, fund formations, restructurings and bankruptcy reorganisations. It also assists clients with contested tax matters, including IRS challenges.
Dean Shulman is a senior partner in Kirkland & Ellis's New York office. Its New York practice has 11 partners and nine other fee earners, including Meredith Levy, who joined the firm in February 2017.
KPMG's New York office offers a broad range of tax services, including federal, state and local taxes, indirect taxes, inbound investments, international tax, M&A and restructurings, tax department performance, tax dispute resolution, trade and customs, transfer pricing and valuation services.
Jeffrey LeSage is the US vice chairman of KPMG. He oversees the team across all tax disciplines. Joseph Hargrove is a principal in KPMG's tax practice and the tax leader for US financial services. Brian Trauman is the national lead for the transfer pricing services.
Latham & Watkins's tax team has considerable experience handling matters for a diverse client base, including multinational corporations, financial institutions, private equity funds, Fortune 500 corporations and emerging companies. Its practitioners advise clients in transactional tax, international tax, tax controversy, tax-exempt organisations, compensation and employment.
Bradd Williamson is the chair of the New York tax department. Williamson frequently advises companies in relation to M&A, spin-offs, IPO and other corporate transactions.
Gordon Warnke heads the US tax practice at Linklaters. The firm's tax experts advise in all areas of cross-border transactions and transactional tax matters. Its expertise includes M&A, joint ventures, capital raising, structured finance, real estate and investment funds.
Warnke's expertise includes the US federal income taxation of domestic and international M&A, spin-offs, divestitures and restructurings.
Jason Bazar and Brian Kittle co-head Mayer Brown's tax practice. The firm's New York practice advises corporates, financial services, funds and other clients on tax transactional planning, tax controversy and transfer pricing matters. Its practitioners also work in the areas of inbound and outbound planning, mergers, acquisitions, divestitures, leveraged and structured financings, financial products and derivatives, as well as state and local tax.
This year, the firm represented Houghton International on its $1.4 billion acquisition by Quaker Chemical Corporation from Gulf Oil Corporation. It also handled all US tax aspects of Canadian Imperial Bank's $3.8 billion cross-border acquisition of PrivateBancorp.
One client said: "Mayer Brown is the 'go to' law firm for tax controversy issues."
McDermott Will & Emery offers complex tax structuring services to large companies and financial organisations. It also advises in international and US-focused tax matters. McDermott remains one of the top tax practices in the US. Its lawyers have a wealth of experience and subject-specific knowledge that enables them to provide effective tax services.
Tom Giegerich advises clients in corporate tax planning, transactional and controversy matters, including, acquisitions and divestitures, corporate restructurings, transfer pricing and tax treaty issues.
Russell Kestenbaum is the practice group leader at Milbank, Tweed, Hadley & McCloy. Its practitioners have advised on significant US-European corporate combinations and provide tax advice on European acquisitions to notable private equity funds. The team also works on cross-border financial restructuring related matters, including in court proceedings.
Kestenbaum counsels a wide range of clients including Arrow Electronics, The Carlyle Group, Cerberus Capital Partners and Deutsche Bank. He advises on tax matters relating to bankruptcies and out of court debt restructurings, the tax aspects of IPOs, M&A and debt issuances.
Morrison & Foerster advises clients on the tax implications of a wide range of transactions. Its professionals have assisted clients the structuring and restructuring of complex business enterprises. The firm provides services in state, local and federal tax.
Craig Fields is the co-chair the firm's tax department and of the state and local tax group. Fields is also the chair of the state and local tax group where his practice focuses on litigation and planning relating to state and local tax matters. Thomas Humphreys is the co-chair of the federal tax practice group and is experienced in capital markets transactions, financial instruments, real estate investment trusts, M&A, bankruptcy and reorganisation and tax controversy.
Norton Rose Fulbright merged with Chadbourne & Parke in 2017. The firm's New York office has teams of transactional and private wealth tax lawyers.
In April 2017, the firm represented Carillon Tower Advisers in the acquisition of Scout Investments for $172.5 million from UMB Financial Corp.
William Cavanagh is the co-head of tax. One client has described Cavanagh as an "absolute genius". "He is efficient, easy to work with and creative, I do not believe there is a finer US tax lawyer practicing today," the client added.
Osler, Hoskin & Harcourt has offices in Toronto, Montreal, Calgary, Ottawa and New York. The firm has an integrated practice which is able to assist clients in M&A, corporate reorganisations and restructurings, general tax advisory, tax litigation and dispute resolution, transfer pricing and Canada/US cross-border tax planning.
Paul Seraganian is the practice manager in the firm's New York office. Seraganian has assisted clients with inbound and outbound tax planning, including treaty-based planning, joint ventures, permanent establishment considerations and cross-border structures. Another member of the team is Jennifer Lee whose practice focuses on federal income tax which particular emphasis on cross-border and domestic transactions.
Paul Hastings advises companies on transactional and dispute-related tax matters. The team comprises lawyers who are recognised internationally for their work in tax.
The firm's transactional team handles a range of tax issues, including structuring finance and capital markets. The New York office comprises nine professionals, two of whom are partners.
Seth Zachary is a chairman at Paul Hastings. His practice focuses on corporate and real estate tax-related problems as well as foreign tax issues. Zachary has also represented numerous corporations and investment banks in federal, state, and local tax matters.
Paul, Weiss, Rifkind, Wharton & Garrison's tax team offers services in domestic and cross-border acquisitions, divestitures and spin-offs, multinational investment and venture capital funds, financings including public and private securities offerings, securitisations, project financings and leveraged leases, bankruptcy and insolvency reorganisations and restructurings, partnerships and joint ventures and real estate matters.
The firm has 10 members, six of which are partners and four who sit as counsel. Brad Okun and Jeffrey Samuels are co-chairs of the tax department. Okun focuses his practice on the tax aspects of M&A, restructurings and corporate finance. He also has experience in advising limited liability companies and partnerships. Samuels's practice covers international and domestic transactions, including public and private M&A, spin-offs, structuring of investment funds, partnership and joint venture transactions. He has represented clients such as Citigroup, Discovery Channel and Virgin Group.
Pillsbury Winthrop Shaw Pittman's tax practice advises on a range of complex transactions. Clients of the firm are multinational corporations, financial institutions, international and domestic joint ventures, new business ventures, non-profit organisations and individuals.
James Chudy leads the firm's global tax practice. Chudy advises domestic and international clients on federal income tax aspects of M&A, spin-offs, bankruptcy reorganisations and business restructurings, corporate finance, securitisations, private equity investments and digital currencies.
Proskauer Rose's tax team advises a range of clients, including Fortune 500 corporations and other business entities, investment funds, institutional investors, tax-exempt organisations and executives. The firm offers services in bankruptcy and restructuring, structured finance, capital markets and securitisations.
Ira Bogner is the chair of the tax department. He counsels clients in the financial services and entertainment sectors on a variety of tax matters.
PwC is a full service firm that advises clients on international tax, state and local tax, tax accounting, tax credits, tax controversy and regulatory process, deductions and studies, tax reporting and strategy, transfer pricing and US inbound tax. Mark Mendola is the vice chairman and US managing partner of PwC.
Roberts & Holland is a respected tax practice. The firm provides services in corporate and international tax, real estate tax, tax controversy and litigation, state and local tax, employee benefits, executive compensation, estate and personal tax planning, debt restructurings and tax-exempt organisations.
The firm has 20 partners, including Lary Wolf who has more than 40 years of experience working with US and foreign clients.
The professionals at Ropes & Gray offer services in domestic and cross-border tax planning, including structuring M&A, spinoffs and joint ventures. The team also advises in IRS examination issues, tax litigation and in matters relating to state controversy.
Clients of the firm include public and private companies, private equity funds and their portfolio companies, public and private mutual funds among others.
Kristen Chang Winckler, Adam Greenwood and Stephen Warnke are partners in the firm.
Shearman & Sterling is a recognised leader in the area of taxation. The firm advises on M&A, spin-offs, restructurings and reorganisations, structured finance and securitisations, hedge fund and private equity fund transactions among other things. The firm also handles tax controversy matters such as audits in the US and Europe, litigation, tax rulings, competent authority proceedings and APAs. The tax group also represents multinational companies in cross-border M&A transactions and financial offerings.
Michael Shulman co-heads the firm's global tax group and advises clients on the tax aspects of business and financial transactions. Laurence Bambino is a former co-head of the firm's global tax group and practices in corporate restructurings, spin-offs, dispositions and acquisitions, as well as transactions involving cross-border tax planning and tax rulings.
The practitioners at Sidley Austin provide tax advice in complex transactions and financing techniques. The firm also represents clients in disputes with the IRS at various levels of the administrative and juridical branches.
Its tax group has more than 60 tax lawyers, over 30 of whom are partners, in the US and London. Laura Barzilai and Robert Kreitman co-head the firm's tax department. Barzilai's practice focuses on federal income tax matters, M&A, reorganisations, joint ventures, restructurings and other transactions. Her clients include Fortune 100 companies, US and non-US privately held companies, insurance companies, banks, hedge funds and private equity funds. Kreitman's principal areas of practice include structured finance, securitisation, financial products and credit derivatives and asset-backed securitisation.
Simpson Thacher & Bartlett advises multinationals, banks, investment funds and other entities on tax matters. The professionals at the firm have handled some of the largest real estate M&A deals, IPOs, financings and restructuring matters.
Robert Holo heads the tax practice. Holo is experienced in corporate M&A, cross-border tax matters, joint ventures, capital markets and financing transactions.
His clients have included KKR, Johnson Controls, Barrick Gold, JPMorgan, Goldman Sachs, Barclays and Bank of America Merrill Lynch.
Stuart Finkelstein heads Skadden, Arps, Slate, Meagher & Flom's New York tax group. The firm's New York office comprises 11 partners, 21 associates and two members of counsel.
The firm has extensive experience in strategic tax planning and tax implementation issues associated with cross-border transactions. Its tax team also represents clients in cross-border tax controversies, including advising on transfer pricing and competent authority matters, and managing and resolving disputes arising from global and regional transactions. The firm also has substantial experience in post-acquisition restructuring.
This year, David Rievman assisted E. I. du Pont de Nemours and Company with the tax aspects related to its merger with The Dow Chemical Company, valued at $130 billion. Tax members Brian Krause, Matthew Hofheimer and Huzefa Mun successfully advised Atlas Resource Partners on its restructuring plan.
Ronald Creamer oversees the tax practice at Sullivan & Cromwell. The tax group has a global reputation for innovative tax planning and the successful resolution of important tax controversies. The group advises some of the largest corporations on their most important and most sensitive US, French and UK tax concerns.
Sullivan & Cromwell's tax practice comprises seven partners and 15 other professionals.
This year, the firm advised energy infrastructure company Enbridge on the tax aspects of its merger agreement with Spectra Energy. It has also advised NorthStar Asset Management Group on the tax aspects of its merger agreement with Colony Capital and NorthStar Realty Finance Corp to create Colony NorthStar.
George Gerachis oversees the tax practice at Vinson & Elkins.
The firm's clients are engaged in many different sectors including energy, technology, healthcare and private equity.
Its tax team assists with M&A, as well as other international transactions. The firm is also experienced in litigation disputes before the US Tax Court, the US Court of Federal Claims and the federal district courts.
Wachtell, Lipton, Rosen & Katz advises clients on the tax aspects of corporate reorganisations, acquisitions, spin-offs, joint ventures, financings and restructurings. Other areas covered by the team's tax practice include corporate tax, litigation and finance.
The firm's tax practice has five partners, two counsels and six associates. The firm's partners include Tijana Dvornic, Joshua Holmes, Jodi Schwartz, Eiko Stange and Deborah Paul.
Members of the firm regularly publish and lecture on emerging tax issues and actively participate in tax policy groups such as the tax section of the New York State Bar Association and the International Fiscal Association.
Kenneth Heitner and Martin Pollack co-head Weil, Gotshal & Manges's tax practice. The firm has 29 partners and 47 other professionals that advise on some of the biggest, most complex domestic and cross-border transactions. Its practitioners deliver innovative and tax efficient solutions in the areas of M&A, private equity and private funds matters, restructurings and recapitalisations, securitisations, real estate, investment trusts and capital markets. The firm also assists in all stages of restructuring including modifications of debt and debt/equity exchanges.
This year, partner Kenneth Heitner advised Reynolds American on the tax aspects of its pending $49 billion sale to British American Tobacco. Partners William Horton and Mark Schwed also advised Goldman Sachs, Deutsche Bank and JP Morgan Chase on the tax aspects of a $15.5 billion bridge financing to support Twenty-First Century Fox.
White & Case's New York tax practice comprises 12 partners and 14 other professionals,
William Dantzler is head of the Americas tax practice. Dantzler's primary areas of practice include domestic and international corporate tax matters, structuring for public and private equity M&A as well as other international transactions. "Dantzler is one of the best lawyers that I've had the pleasure and privilege to work with. He is extremely knowledgeable and provides answers to very complicated tax questions," said one client.
Tomer Dorfan joined the firm in January 2017, and Grayson Weeks in late 2016.
The firm's New York practice focuses on cross-border transactional matters, including corporate and banking transactions, securities transactions, private equity and fund structuring, as well as tax advisory. Its practitioners have extensive experience in the tax aspects of capital markets transactions, including representation of foreign issuers.
Willkie Farr & Gallagher has a multi-disciplinary team that provides tax planning and structuring advice to clients from a range of sectors. Its practitioners assist clients with M&A, private equity, insurance transactional, real estate, asset management and business reorganisation.
Richard Reinhold is senior counsel at Willkie Farr & Gallagher. His practice includes domestic and international business tax matters relating to M&A, joint ventures, investment funds, corporate restructurings and financing transactions.
Winston & Strawn has an integrated tax practice that addresses all areas of tax law. The firm comprises 40 professionals who have represented some of the largest US public companies on federal tax planning, state and local tax and controversy matters.
Partner Edmund Cohen has more than 30 years of industry experience and has assisted clients with tax planning for investment funds and high-net-worth individuals.
Clients of the firm include Luxottica, Barclays Capital and Wells Fargo.
|Tier 1 - US: New York|
|Cleary Gottlieb Steen & Hamilton|
|Cravath, Swaine & Moore|
|Davis Polk & Wardwell|
|Norton Rose Fulbright|
|Skadden, Arps, Slate, Meagher & Flom|
|Sullivan & Cromwell|
|Wachtell, Lipton, Rosen & Katz|
|Weil, Gotshal & Manges|
|Tier 2 - US: New York|
|Debevoise & Plimpton|
|Fried, Frank, Harris, Shriver & Jacobson|
|Paul, Weiss, Rifkind, Wharton & Garrison|
|Shearman & Sterling|
|Simpson Thacher & Bartlett|
|Tier 3 - US: New York|
|Cadwalader, Wickersham & Taft|
|Freshfields Bruckhaus Deringer|
|Kirkland & Ellis|
|McDermott Will & Emery|
|Milbank, Tweed, Hadley & McCloy|
|Tier 4 - US: New York|
|Alvarez & Marsal, Taxand USA|
|Latham & Watkins|
|Morrison & Foerster|
|Pillsbury Winthrop Shaw Pittman|
|Roberts & Holland|
|Vinson & Elkins|
|White & Case|
|Willkie Farr & Gallagher|
|Winston & Strawn|
|Tier 5 - US: New York|
|Alston & Bird|
|Davies Ward Phillips & Vineberg|
|Osler, Hoskin & Harcourt|
|Ropes & Gray|