3M Urges Court to Limit IRS Power to Reallocate Brazil Royalties

Feb. 9, 2024, 8:12 PM UTC

The Eighth Circuit should stop the IRS from reallocating almost $23.7 million of 3M Co.‘s royalty income from its Brazilian subsidiary to the US parent for tax purposes because the relied-upon tax code regulation is substantively and procedurally invalid, the company said in an appellate brief.

3M challenged a $4.8 million notice of deficiency issued by the IRS after it allocated more than $23 million in additional income under IRC Section 482 to reflect the arm’s-length compensation the agency says 3M do Brasil Ltda. should’ve paid its parent for intellectual property. The company appeals a US Tax Court ruling ...

Learn more about Bloomberg Tax or Log In to keep reading:

Learn About Bloomberg Tax

From research to software to news, find what you need to stay ahead.

Already a subscriber?

Log in to keep reading or access research tools.