Microsoft Allows IRS ‘Quick Peek' at Some Documents

The Tax Management Transfer Pricing Report ™ provides news and analysis on U.S. and international governments’ tax policies regarding intercompany transfer pricing. 

By Molly Moses

May 24 — Microsoft Corp. agreed to allow the IRS to inspect some of the documents for which the company had claimed privilege with the understanding that the company, in allowing the “quick peek,” isn't waiving its privilege claims.

The stipulated motion was one of two filed May 23 that show the parties are working through their dispute over documents in a summons enforcement case. A separate stipulated motion said Microsoft and the government have met and spoken several times “in order to resolve as many disputes regarding specific production requests as possible” and asked the court to give them until July 16 to “meet and confer on any remaining disputes with respect to particular requests.”

The motion agreeing to the quick-peek inspection asked for an order under Federal Rules of Evidence 502(d), which would allow the party claiming privilege for documents to show the documents to the other party without waiving privilege over them.

U.S. Tax Court Judge David Laro issued such an order in Guidant LLC v. Commissioner—in that case, allowing the taxpayer to view documents the government withheld on grounds of deliberative process privilege (see the related story)

The summons enforcement in Microsoft's case relates to an ongoing audit of two of the company's cost-sharing agreements. One issue is the company's claim that the Internal Revenue Service improperly hired an outside law firm to help in the transfer pricing audit (23 Transfer Pricing Report 1489, 4/2/15).

To contact the reporter on this story: Molly Moses in Washington at

To contact the editor responsible for this story: Brett Ferguson at

For More Information

The stipulated motion for an order under FRE 502(d) is at

The stipulated motion to enlarge time is at