• BMC Software, Inc. v. Commissioner: U.S. Court of Appeals Rejects IRS Attempt to Apply Closing Agreement Retroactively to Support an Unrelated Proposed Adjustment to Tax
  • April 6, 2015 | Authors: James R. Gadwood; Donald L. Korb; Andrew S. Mason; Andrew P. Solomon; S. Eric Wang
  • Law Firm: Sullivan & Cromwell LLP - New York Office
  • From 2003 to 2006, U.S. corporations were entitled, in certain circumstances, to elect a one-time dividends-received deduction for dividends from controlled foreign corporations. BMC Software, Inc. made this election for its 2006 tax year and received a dividend from a foreign subsidiary. In connection with a subsequent transfer-pricing audit, BMC agreed that it overpaid royalties to the foreign subsidiary that paid the dividend.