Recent trends in state transfer pricing controversies

myStateTaxOffice

Numerous headlines have illustrated the issue of state governments struggling to bring in revenues sufficient to cover state budgets. One action that states are increasingly pursuing as a source of inflows is proposing tax assessments related to alleged transfer pricing abuses by corporate taxpayers. CFO.com indicated that 49% of chief financial officers polled find state tax compliance more challenging than federal tax compliance. One potential reason for this response is the increasing focus of state revenue authorities on transfer pricing issues that previously may have been treated as "federal" audit items.



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