IRS: LB&I Auditors Will Not Dispute Certain Milestone Payment Elections

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The Internal Revenue Service's Large Business and International Division auditors will not challenge a taxpayer's safe harbor treatment of eligible milestone payments made during the course of certain corporate transactions that incur success-based fees, LB&I Commissioner Heather Maloy said in a directive issued April 29.
The directive (LB&I-04-0413-002) applies only to investment banker fees incurred as eligible milestone payments by either an acquiring corporation or a target corporation, IRS said. The directive further applies only for the amounts deducted on a business's original timely filed returns, but not for formal or informal claims, IRS said.

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