Minimum royalties must be capitalized to ending inventory, IRS concludes

Washington National Tax Services
The IRS concluded in recently released field attorney advice (FAA 20124401F) that minimum royalties paid for the use of licensed patents must be capitalized to ending inventory under Section 263A.  The conclusions reached in the FAA could impact any taxpayer with a minimum royalty arrangement.


Return to Tax research and insights
Washington National Tax Services newsletter archive