Sullivan
Microsoft has discontinued support for Internet Explorer. To access the Sullivan website, please install a modern browser like Microsoft Edge or Google Chrome.

Douglas Stransky was quoted in the article entitled "'Significant Implications’: Experts Analyse US v Facebook TP Ruling,” published in International Tax Review [sub. req'd] on May 28, 2025.

In the Facebook v. Commissioner case, Facebook challenged the IRS’s valuation of its cost-sharing arrangement with its Irish subsidiary, which the IRS pegged at $19.9 billion, significantly higher than Facebook’s self-assessed value of $6.3 billion.

The article discusses the recent Tax Court decision that upheld the IRS’s use of the income method for valuation but found its inputs unreliable, ultimately recalculating the value of the transferred intangibles at approximately $7.8 billion. The court also affirmed the validity of the 2009 cost-sharing regulations and rejected Facebook’s argument that cost-sharing payers must achieve a positive net present value.

In the article, Doug discusses how the case illustrates the intricacies involved in valuing intangible assets within multinational tax arrangements, emphasizing that the ruling underscores the need for companies to provide strong and well-supported valuations as they navigate the changing landscape of international taxation and compliance.