Introduction
The United States has one of the most developed transfer pricing regimes in the world, governed by Internal Revenue Code Section 482 and detailed Treasury Regulations. The IRS plays a leading role in global transfer pricing discourse, especially on high-value intangibles, cost-sharing arrangements, and APAs.
Key Features
Regulatory Authority: Section 482 of the IRC, with extensive Treasury Regulations.
APAs and MAPs: The Advance Pricing and Mutual Agreement (APMA) Program is one of the most active globally.
Documentation: Though no formal master file requirement, detailed contemporaneous documentation is mandated to avoid penalties.
CbCR Filing: Through Form 8975 for MNEs with revenue over $850 million.
Current Developments
Increased focus on cost sharing and intangibles, especially post-Altera and Amazon cases.
Pillar Two alignment is ongoing, with partial overlap via GILTI and BEAT rules.
Emphasis on substance over form and economic reality in audit reviews.
Conclusion
Transfer pricing in the US requires rigorous documentation and defensible economic analysis. MNEs operating in the US should prepare for deep functional reviews and proactive engagement with the IRS.
