As previously captured in our PKN alert issued on July 28, 2011 (click here to review), the staff at the IRS Advance Pricing Agreement (APA) Program and the Tax Treaty Office staff who handle Mutual Agreement Procedure (MAP) cases involving transfer pricing will be combined into one office within LB&I's international operations as part of a new "Advance Pricing Agreement and Mutual Agreement Program" (the new program will be referred to as "APMA"). As a result of this reorganization, the APA Program and the MAP office are currently working towards the goal of becoming one office under the jurisdiction of the new Transfer Pricing Director in LB&I, Sam Maruca.
This PKN updates PwC's previous PKN by summarizing recent statements made by Mr. Maruca regarding the new APMA Program. Speaking at a District of Columbia Bar Association Tax Section Luncheon on September 13, 2011, Mr. Maruca set forth his overall vision for revamping the current transfer pricing environment at the IRS and for the pending reorganization. The main goal of the LB&I reorganization is to create an integrated structure that subsumes all major pieces of transfer pricing enforcement into one office. In his statements, Mr. Maruca acknowledged the IRS' recent losses in cases involving key issues, which has driven in part his goal of enhancing the technical expertise and advocacy skills of its personnel.