Internal Revenue Bulletin 2020-15 (PDF rendition): IRS Revenue Procedures

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Bulletin No. 2020–15
April 6, 2020
HIGHLIGHTS
OF THIS ISSUE
These synopses are intended only as aids to the reader in
identifying the subject matter covered. They may not be
relied upon as authoritative interpretations.
ADMINISTRATIVE

Announcement 2020-2, page 609.
This Announcement is issued pursuant to § 521(b) of Pub.
L. 106-170, the Ticket to Work and Work Incentives Im-
provement Act of 1999, which requires the Secretary of
the Treasury to report annually to the public concerning ad-
vance pricing agreements (APAs) and the Advance Pricing
and Mutual Agreement Program (APMA Program), formerly
known as the Advance Pricing Agreement Program (APA
Program). This twenty-first report describes the experi-
ence, structure, and activities of the APMA Program during
calendar year 2019.
Announcement 2020-3, page 655.
The Office of Professional Responsibility (OPR) announces re-
cent disciplinary sanctions involving attorneys, certified pub-
lic accountants, enrolled agents, enrolled actuaries, enrolled
retirement plan agents, and appraisers. These individuals are
subject to the regulations governing practice before the Inter-
nal Revenue Service (IRS), which are set out in Title 31, Code
of Federal Regulations, Part 10, and which are published in
pamphlet form as Treasury Department Circular No. 230.
The regulations prescribe the duties and restrictions relating
to such practice and prescribe the disciplinary sanctions for
violating the regulations.
Notice 2020-17, page 590.
This notice provides tax relief under section 7508A of the
Code for taxpayers affected by the Coronavirus Disease
2019 (COVID-19) emergency. The due date for certain Fed-
eral income tax payments due April 15, 2020, is postponed
to July 15, 2020. Associated interest, additions to tax, and
penalties for late payment will also be suspended until July
15, 2020. This notice is superseded by Notice 2020-18.
Notice 2020-18, page 590.
This notice supersedes Notice 2020-17 and provides tax
relief under section 7508A of the Code for taxpayers affect-
ed by the Coronavirus Disease 2019 (COVID-19) emergen-
cy. The due date for filing Federal income tax returns and
making Federal income tax payments due April 15, 2020, is
postponed to July 15, 2020. Associated interest, additions
to tax, and penalties for late payment will also be suspended
until July 15, 2020.
Rev. Proc. 2020-18, page 592.
This revenue procedure provides issuers of qualified mort-
gage bonds, as defined in section 143(a) of the Internal Rev-
enue Code, and issuers of mortgage credit certificates, as
defined in section 25(c), with (1) the nationwide average pur-
chase price for residences located in the United States, and
(2) average area purchase price safe harbors for residences
located in statistical areas in each state, the District of Co-
lumbia, Puerto Rico, the Northern Mariana Islands, American
Samoa, the Virgin Islands, and Guam.
INCOME TAX
Rev. Rul. 2020-9, page 563.
Federal rates; adjusted federal rates; adjusted federal long-term
rate, the long-term exempt rate, and the blended annual rate.
For purposes of sections 382, 1274, 1288, 7872 and other
sections of the Code, tables set forth the rates for April 2020.
Finding Lists begin on page ii.

Rev. Rul. 2020-10, page 565.
Fringe benefits aircraft valuation formula. For purposes of
section 1.61-21(g) of the Income Tax Regulations, relating to
the rule for valuing non-commercial flights on employer-pro-
vided aircraft, the Standard Industry Fare Level (SIFL) cents-
per-mile rates and terminal charge in effect for the first half
of 2020 are set forth.
T.D. 9895, page 565.
The final regulations provide rules under section 901(m) for
determining the amount of foreign taxes that are disqualified
for foreign tax credit purposes with respect to certain cov-
ered asset acquisitions that result in a basis step-up for U.S.
income tax purposes but not foreign tax purposes.
Notice 2020-19, page 591.
Notice 2020-19 withdraws Notice 2004-20, therefore re-
moving the identification of transactions that are the same
as, or substantially similar to, the transaction described in
that notice as “listed transactions,” because the enactment
of section 901(m) has curtailed the use of those transac-
tions.

The IRS Mission
Provide America’s taxpayers top-quality service by helping
them understand and meet their tax responsibilities and en-
force the law with integrity and fairness to all.
Introduction
The Internal Revenue Bulletin is the authoritative instrument
of the Commissioner of Internal Revenue for announcing of-
ficial rulings and procedures of the Internal Revenue Service
and for publishing Treasury Decisions, Executive Orders, Tax
Conventions, legislation, court decisions, and other items of
general interest. It is published weekly.
It is the policy of the Service to publish in the Bulletin all sub-
stantive rulings necessary to promote a uniform application
of the tax laws, including all rulings that supersede, revoke,
modify, or amend any of those previously published in the
Bulletin. All published rulings apply retroactively unless other-
wise indicated. Procedures relating solely to matters of inter-
nal management are not published; however, statements of
internal practices and procedures that affect the rights and
duties of taxpayers are published.
Revenue rulings represent the conclusions of the Service
on the application of the law to the pivotal facts stated in
the revenue ruling. In those based on positions taken in rul-
ings to taxpayers or technical advice to Service field offices,
identifying details and information of a confidential nature are
deleted to prevent unwarranted invasions of privacy and to
comply with statutory requirements.
Rulings and procedures reported in the Bulletin do not have the
force and effect of Treasury Department Regulations, but they
may be used as precedents. Unpublished rulings will not be
relied on, used, or cited as precedents by Service personnel in
the disposition of other cases. In applying published rulings and
procedures, the effect of subsequent legislation, regulations,
court decisions, rulings, and procedures must be considered,
and Service personnel and others concerned are cautioned
against reaching the same conclusions in other cases unless
the facts and circumstances are substantially the same.
The Bulletin is divided into four parts as follows:
Part I.—1986 Code.
This part includes rulings and decisions based on provisions
of the Internal Revenue Code of 1986.
Part II.—Treaties and Tax Legislation.
This part is divided into two subparts as follows: Subpart A,
Tax Conventions and Other Related Items, and Subpart B,
Legislation and Related Committee Reports.
Part III.—Administrative, Procedural, and Miscellaneous.
To the extent practicable, pertinent cross references to these
subjects are contained in the other Parts and Subparts. Also
included in this part are Bank Secrecy Act Administrative
Rulings. Bank Secrecy Act Administrative Rulings are issued
by the Department of the Treasury’s Office of the Assistant
Secretary (Enforcement).
Part IV.—Items of General Interest.
This part includes notices of proposed rulemakings, disbar-
ment and suspension lists, and announcements.
The last Bulletin for each month includes a cumulative index
for the matters published during the preceding months. These
monthly indexes are cumulated on a semiannual basis, and are
published in the last Bulletin of each semiannual period.
The contents of this publication are not copyrighted and may be reprinted freely. A citation of the Internal Revenue Bulletin as the source would be appropriate.
April 6, 2020 Bulletin No. 2020–15

Part I
Section 1274.—
Determination of Issue
Price in the Case of Certain
Debt Instruments Issued for
Property
(Also Sections 42, 280G, 382, 467, 468, 482, 483,
1288, 7520, 7872.)
Rev. Rul. 2020-9
This revenue ruling provides various
prescribed rates for federal income tax
purposes for April 2020 (the current
month). Table 1 contains the short-
term, mid-term, and long-term applica-
ble federal rates (AFR) for the current
month for purposes of section 1274(d)
of the Internal Revenue Code. Table 2
contains the short-term, mid-term, and
long-term adjusted applicable federal
rates (adjusted AFR) for the current
month for purposes of section 1288(b).
Table 3 sets forth the adjusted feder-
al long-term rate and the long-term
tax-exempt rate described in section
382(f). Table 4 contains the appropri-
ate percentages for determining the
low-income housing credit described in
section 42(b)(1) for buildings placed in
service during the current month. How-
ever, under section 42(b)(2), the appli-
cable percentage for non-federally sub-
sidized new buildings placed in service
after July 30, 2008, shall not be less
than 9%. Finally, Table 5 contains the
federal rate for determining the present
value of an annuity, an interest for life
or for a term of years, or a remainder or
a reversionary interest for purposes of
section 7520.
REV. RUL. 2020-9 TABLE 1
Applicable Federal Rates (AFR) for April 2020
Period for Compounding
AnnualSemiannualQuarterlyMonthly
Short-term
AFR0.91%0.91%0.91%0.91%
110% AFR1.00%1.00%1.00%1.00%
120% AFR1.09%1.09%1.09%1.09%
130% AFR1.18%1.18%1.18%1.18%
Mid-term
AFR0.99%0.99%0.99%0.99%
110% AFR 1.09%1.09%1.09%1.09%
120% AFR1.19%1.19%1.19%1.19%
130% AFR1.29%1.29%1.29%1.29%
150% AFR1.50%1.49%1.49%1.49%
175% AFR1.74%1.73%1.73%1.72%
Long-term
AFR1.44%1.43%1.43%1.43%
110% AFR1.58%1.57%1.57%1.56%
120% AFR1.73%1.72%1.72%1.71%
130% AFR1.87%1.86%1.86%1.85%
REV. RUL. 2020-9 TABLE 2
Adjusted AFR for April 2020
Period for Compounding
AnnualSemiannualQuarterlyMonthly
Short-term adjusted AFR0.69% 0.69% 0.69%0.69%
Mid-term adjusted AFR0.75% 0.75%0.75%0.75%
Long-term adjusted AFR 1.09% 1.09% 1.09%1.09%
Bulletin No. 2020–15 563 April 6, 2020

REV. RUL. 2020-9 TABLE 3
Rates Under Section 382 for April 2020
Adjusted federal long-term rate for the current month1.09%
Long-term tax-exempt rate for ownership changes during the current month (the highest of
the adjusted federal long-term rates for the current month and the prior two months.)
1.63%
REV. RUL. 2020-9 TABLE 4
Appropriate Percentages Under Section 42(b)(1) for April 2020
Note: Under section 42(b)(2), the applicable percentage for non-federally subsidized new buildings placed in service after July
30, 2008, shall not be less than 9%.
Appropriate percentage for the 70% present value low-income housing credit7.28%
Appropriate percentage for the 30% present value low-income housing credit 3.12%
REV. RUL. 2020-9 TABLE 5
Rate Under Section 7520 for April 2020
Applicable federal rate for determining the present value of an annuity, an interest for life or
a term of years, or a remainder or reversionary interest
1.2%
Section 42.—Low-Income
Housing Credit
The applicable federal short-term, mid-term,
and long-term rates are set forth for the month of
April 2020. See Rev. Rul. 2020-9, page 563.
Section 280G.—Golden
Parachute Payments
The applicable federal short-term, mid-term,
and long-term rates are set forth for the month of
April 2020. See Rev. Rul. 2020-9, page 563.
Section 382.—Limitation
on Net Operating Loss
Carryforwards and
Certain Built-In Losses
Following Ownership
Change
The adjusted applicable federal long-term rate
is set forth for the month of April 2020. See Rev.
Rul. 2020-9, page 563.
Section 467.—Certain
Payments for the Use of
Property or Services
The applicable federal short-term, mid-term,
and long-term rates are set forth for the month of
April 2020. See Rev. Rul. 2020-9, page 563.
Section 468.—Special
Rules for Mining and Solid
Waste Reclamation and
Closing Costs
The applicable federal short-term rates are set
forth for the month of April 2020. See Rev. Rul.
2020-9, page 563.
Section 482.—Allocation
of Income and Deductions
Among Taxpayers
The applicable federal short-term, mid-term,
and long-term rates are set forth for the month of
April 2020. See Rev. Rul. 2020-9, page 563.

Section 483.—Interest on
Certain Deferred Payments
The applicable federal short-term, mid-term,
and long-term rates are set forth for the month of
April 2020. See Rev. Rul. 2020-9, page 563.
Section 1288.—Treatment
of Original Issue Discount
on Tax-Exempt Obligations
The adjusted applicable federal short-term, mid-
term, and long-term rates are set forth for the month of
April 2020. See Rev. Rul. 2020-9, page 563.
Section 7520.—Valuation
Tables
The applicable federal mid-term rates are set
forth for the month of April 2020. See Rev. Rul.
2020-9, page 563.
Section 7872.—Treatment
of Loans With Below-
Market Interest Rates
The applicable federal short-term, mid-term,
and long-term rates are set forth for the month of
April 2020. See Rev. Rul. 2020-9, page 563.

April 6, 2020 564 Bulletin No. 2020–15

Bulletin No. 2020–15 565 April 6, 2020
Section 61. Gross Income
Defined
26 CFR 1.61-21: Taxation of fringe benefits.
Rev. Rul. 2020-10
For purposes of the taxation of fringe
benefits under section 61 of the Internal
Revenue Code, section 1.61-21(g) of the
Income Tax Regulations provides a rule
for valuing noncommercial flights on
employer-provided aircraft. Section 1.61-
21(g)(5) provides an aircraft valuation
formula to determine the value of such
flights. The value of a flight is determined
under the base aircraft valuation formula
(also known as the Standard Industry Fare
Level formula or SIFL) by multiplying
the SIFL cents-per-mile rates applicable
for the period during which the flight was
taken by the appropriate aircraft multiple
provided in section 1.61-21(g)(7) and then
adding the applicable terminal charge. The
SIFL cents-per-mile rates in the formula
and the terminal charge are calculated by
the Department of Transportation and are
reviewed semi-annually.
The following chart sets forth the ter-
minal charge and SIFL mileage rates
Period During Which Terminal SIFL Mileage
the Flight Is Taken Charge Rates
1/1/20 - 6/30/20 $42.84 Up to 500 miles
= $.2344 per mile
501-1500 miles
= $.1787 per mile
Over 1500 miles
= $.1718 per mile

DRAFTING INFORMATION
The principal author of this revenue
ruling is Kathleen Edmondson of the Of-
fice of Associate Chief Counsel (Employ-
ee Benefits, Exempt Organizations and
Employment Taxes). For further informa-
tion regarding this revenue ruling, contact
Ms. Edmondson at (202) 317-6798 (not a
toll-free call).

26 CFR 1.901(m)-1 through -8: Covered Asset Ac-
quisitions
T.D. 9895
DEPARTMENT OF THE
TREASURY
Internal Revenue Service
26 CFR Part 1
Covered Asset Acquisitions
AGENCY: Internal Revenue Service
(IRS), Treasury.
ACTION: Final regulations and removal
of temporary regulations.

SUMMARY: This document contains fi-
nal Income Tax Regulations under section
901(m) of the Internal Revenue Code (Code)
with respect to transactions that general-
ly are treated as asset acquisitions for U.S.
income tax purposes and either are treated
as stock acquisitions or are disregarded for
foreign income tax purposes. These regula-
tions are necessary to provide guidance on
applying section 901(m). These regulations
affect taxpayers claiming foreign tax credits.
DATES: Effective date: These regulations
are effective on March 23, 2020.
Applicability dates: For dates of applicabili-
ty, see §§1.704-1(b)(1)(ii)(b)(4), 1.901(m)-
1(b), 1.901(m)-2(f), 1.901(m)-3(d),
1.901(m)-4(g), 1.901(m)-5(i), 1.901(m)-
6(d), 1.901(m)-7(g), and 1.901(m)-8(e).
FOR FURTHER INFORMATION CON-
TACT: Jeffrey L. Parry at (202) 317-6936
(not a toll-free number).
SUPPLEMENTARY INFORMATION:
Background
On December 7, 2016, both a notice
of proposed rulemaking by cross-ref-

erence in part to temporary regulations
(REG-129128-14) (2016 proposed regu-
lations) under sections 901(m) and 704
of the Code and temporary regulations
(TD 9800) under section 901(m) were
published in the Federal Register at 81
FR 88562 and 81 FR 88103. The tem-
porary and proposed regulations include
the rules described in Notice 2014-44
(2014-32 I.R.B. 270 (August 4, 2014))
and Notice 2014-45 (2014-34 I.R.B. 388
(August 18, 2014).
A public hearing was not requested,
and none was held. However, the De-
partment of the Treasury (Treasury De-
partment) and the IRS received written
comments in response to the notice of
proposed rulemaking. After consider-
ation of all the comments, the 2016 pro-
posed regulations under section 901(m)
are adopted as revised by this Treasury
decision. The revisions are discussed in
this preamble. This Treasury decision
also adopts the 2016 proposed regula-
tions under section 704 without revision.
The regulations adopted by this Treasury
decision are referred to herein as the “fi-
nal regulations.” Defined terms used in
this preamble but not defined herein have
the meaning provided in the final regu-
lations.

April 6, 2020 566 Bulletin No. 2020–15
Summary of Comments and
Explanation of Revisions
1. Scope of covered asset acquisitions
(CAAs)
Proposed §1.901(m)-2(b) identifies six
categories of transactions that constitute
CAAs, three of which are specified in the
statute and three of which are additional
categories of transactions that are iden-
tified as CAAs pursuant to the authority
granted under section 901(m)(2)(D).
One comment requested that an ex-
emption to section 901(m) be provided
for CAAs in which all or substantially all
of the gains and losses with respect to the
relevant foreign assets (RFAs) are recog-
nized by members of the U.S.-parented
group that includes the section 901(m)
payor. The comment suggested that the
policies of section 901(m) are not impli-
cated in such a situation because if the
same group takes into account the gains
on the RFAs up front and then, in the fu-
ture recognizes offsetting cost recovery
items on those assets, over time, the U.S.
income tax base is unchanged.
The Treasury Department and IRS
agree that an exemption would be appro-
priate in certain cases, but have determined
that the comment’s suggestion is over-
broad. As proposed by the comment, the
exemption would apply to U.S. members
of an affiliated group that do not file a con-
solidated return and to related controlled
foreign corporations. This leaves open the
possibility of manipulation of foreign tax
credits. For example, in the case of affil-
iated but non-consolidated U.S. entities,
the entity recognizing the U.S. gain on
the assets up front may be an entity that is
exempt from tax under section 501 while
the entity recognizing the offsetting cost
recovery items may be in a position to
take advantage of the excess foreign taxes
related to the basis difference.
The Treasury Department and IRS
have determined that the exemption
should apply only if a domestic section
901(m) payor or a member of its consoli-
dated group recognized the gains or losses
or took into account a distributive share of
the gains or losses recognized by a part-
nership for U.S. tax purposes as part of the
original CAA. Accordingly, the definition
of aggregate basis difference is modified
to take into account allocated basis dif-
ference adjustments determined based on
gain or loss recognized with respect to an
RFA as a result of a CAA. See §1.901(m)-
1(a)(1), (6), (48), and (49). For example,
if one domestic corporation, USS1, sold a
foreign disregarded entity (FDE) that held
an asset to another member of its consol-
idated group, USS2, the transaction is a
CAA, because it is an asset sale for U.S.
income tax purposes and an acquisition of
stock of the FDE for foreign tax purposes.
As a result, the asset is an RFA owned by
USS2 subject to section 901(m). Howev-
er, any aggregate basis difference USS2
determines with respect to the RFA will be
adjusted to take into account the gain rec-
ognized for U.S. income tax purposes by
USS1 on the original sale, provided USS1
and USS2 are still members of the same
consolidated group in the year the allocat-
ed basis difference is determined.
Another comment suggested that the
final category of transactions, which in-
cludes any asset acquisition for U.S. and
foreign income tax purposes that results in
an increase in the U.S. basis without a cor-
responding increase in the foreign basis,
be replaced with one or more specifically
defined transactions. The comment recom-
mended that new CAAs be limited to spe-
cific transactions that are likely to achieve
the same hyping of foreign tax credits as
the three categories of CAAs specified in
the statute and that typically involve in-
tensive U.S. tax planning. The comment
also suggested that if the Treasury De-
partment and IRS found a list of specific
transactions to be too limited, they could
add an anti-abuse rule that would treat any
transaction as a CAA if it was structured
with a principal purpose of avoiding the
specific categories of transactions set forth
in the revised list of transactions.
The Treasury Department and IRS do
not agree that the final category of transac-
tions is overbroad. Section 901(m) is de-
signed to address transactions that result
in a basis difference for U.S. and foreign
income tax purposes. There is no intent
test. Proposed §1.901(m)-7 provides a de
minimis exception that relieves the burden
of applying section 901(m) to ordinary
course transactions below the threshold
provided in that rule. The Treasury De-
partment and IRS have determi
ned there
is no policy justification for exempting
transactions to which this exception does
not apply on the grounds that the transac-
tion lacked an intent to hype foreign taxes,
and replacing this category of transactions
with an anti-abuse rule would inappropri-
ately introduce an intent component that
is not required by the statute. Accordingly,
the comment is not adopted.
2. Aggregate basis difference carryover
Proposed §1.901(m)-3(c) provides
rules for determining the amount of aggre-
gate basis difference carryover for a giv-
en U.S. taxable year of a section 901(m)
payor that will be included in the section
901(m) payor’s aggregate basis difference
for the next U.S. taxable year. The carry-
over reflects the extent to which the ag-
gregate basis difference for a U.S. taxable
year has not yet given rise to a disqualified
tax amount.
A comment requested that the aggre-
gate basis difference carryover rule be
eliminated due to the increased compli-
ance costs resulting from the added com-
plexity of tracking the carryover amounts.
The comment argued that these compli-
ance costs are unjustified, given that Con-
gress enacted an administrable approach
in the statute and did not express any in-
tent that carryover rules could apply.
The Treasury Department and IRS
have determined that the aggregate basis
difference carryover rule is necessary to
prevent the avoidance of the purpose of
section 901(m), particularly in the case of
timing differences. For example, assume a
section 901(m) payor that is also a foreign
payor has a foreign taxable year ending on
March 31 and a U.S. taxable year ending
on December 31. Assume further that the
section 901(m) payor recognizes foreign
gain on the disposition of an RFA on No-
vember 30, in U.S. tax year 1. For U.S.
income tax purposes, because the disposi-
tion occurs in U.S. tax year 1, the section
901(m) payor will have allocated basis
difference in U.S. tax year 1, requiring a
calculation of a disqualified tax amount.
For foreign income tax purposes, the for-
eign tax on the gain is not imposed until
the end of the foreign taxable year, which
is March 31, in U.S. tax year 2. Assum-
ing the section 901(m) payor does not
pay any other foreign taxes, the disqual-
ified tax amount for U.S. tax year 1 will

Bulletin No. 2020–15 567 April 6, 2020
be zero, because the foreign taxes are not
taken into account by the section 901(m)
payor for U.S. income tax purposes until
U.S. tax year 2. Because the allocated ba-
sis difference in U.S. tax year 1 does not
give rise to a disqualified tax amount, the
aggregate basis difference carryover rule
requires that the allocated basis differ-
ence be carried into U.S. tax year 2 and be
used to calculate a disqualified tax amount
with respect to the foreign taxes taken
into account in U.S. tax year 2. Without
the aggregate basis difference carryover
rule, there would be no disqualified tax
amount in U.S. tax year 1, because there
are not foreign taxes taken into account in
that year, and no disqualified tax amount
in U.S. tax year 2, because there is no al-
located basis difference in that year. This
would allow avoidance of the application
of section 901(m) to a fact pattern that is
clearly meant to be covered by the statute.
The aggregate basis difference carryover
rule also prevents taxpayers from avoid-
ing the application of section 901(m) by
timing dispositions of RFAs to coincide
with offsetting unrelated foreign losses.
For these reasons, the comment is not ad-
opted.
3. Foreign basis election
Basis difference with respect to an RFA
is generally equal to the U.S. basis in the
RFA immediately after a CAA less the
U.S. basis in the RFA immediately before
the CAA. Proposed §1.901(m)-4(c) pro-
vides that a taxpayer may instead elect to
determine basis difference as the U.S. ba-
sis in the RFA immediately after the CAA
less the foreign basis in the RFA immedi-
ately after the CAA. This is referred to as
the foreign basis election. Paragraphs (c)
and (g)(3) of proposed §1.901(m)-4 pro-
vide that taxpayers may apply the foreign
basis election retroactively to CAAs that
have occurred on or after January 1, 2011,
provided that the taxpayer applies all of
the rest of the rules in the 2016 proposed
regulations retroactively, with a few limit-
ed exceptions.
One comment suggested that though
this consistency requirement is appro-
priate for tax years that remain open, the
requirement is unfair if some tax years of
the taxpayer or its affiliates are already
closed. The comment recommended the
consistency requirement be modified to
permit taxpayers to apply the foreign ba-
sis election as long as they apply the rules
in the 2016 proposed regulations consis-
tently to all relevant tax years that remain
open.
The Treasury Department and IRS
agree that taxpayers should not be denied
the choice to retroactively apply the for-
eign basis election because a closed tax
year is preventing them from satisfying the
consistency requirement. However, be-
cause the statute of limitations for refunds
attributable to foreign tax credits is ten
years while the statute of limitations for
assessment is generally only three years,
the only relevant tax years of the taxpay-
er or its affiliates that would be closed are
the tax years in which a consistent appli-
cation of the regulations would result in
an assessment. The Treasury Department
and IRS do not believe taxpayers should
be able to obtain the benefits of retroac-
tive application of the regulations while
avoiding the negative consequences. Ac-
cordingly, while the consistency require-
ment has been modified to apply only for
tax years that remain open, an additional
requirement is added that any deficiencies
be taken into account that would have re-
sulted from the consistent application of
the final regulations for a tax year that is
closed. See §1.901(m)-4(g)(3). For exam-
ple, assume a taxpayer chooses to make
a retroactive foreign basis election that
would give rise to a $6 million refund in a
prior year that is open under the statute of
limitations for refunds but that a consis-
tent retroactive application of another pro-
vision of the final regulations would give
rise to a $1 million deficiency in another
prior year that is closed under the statute
of limitations for assessment. In this case,
in order to meet the consistency require-
ment, the taxpayer would need to reduce
its refund claim in the open year from $6
million to $5 million to take into account
the $1 million deficiency that would have
resulted in the closed tax year.
4. Successor rules
The successor rules in proposed
§1.901(m)-6(b) provide that section
901(m) continues to apply to any unallo-
cated basis difference with respect to an
RFA after there is a transfer of the RFA
for U.S. income tax purposes, regardless
of whether the transfer is a disposition, a
CAA, or a non-taxable transaction. For
example, if a section 901(m) payor con-
tributes an RFA with respect to a prior
CAA to a partnership, any unallocated ba-
sis difference in the RFA remains subject
to the section 901(m) in the hands of the
partnership. One comment suggested that
the Treasury Department and IRS consid-
er whether it would be appropriate to ap-
ply principles similar to those of section
704(c) to treat the section 901(m) “taint”
in the RFA as a built-in item that is allocat-
ed back to the contributing partner.
The Treasury Department and IRS
have considered this comment and de-
termined that the provisions in proposed
§1.901(m)-5 for allocating basis differ-
ence to partners in a partnership that owns
RFAs reflect the most appropriate ap-
proach, whether the RFAs are contributed
to the partnership in a successor transac-
tion or the partnership acquires them di-
rectly in a CAA. These allocation rules are
based on the principle that the partner that
takes into account the basis difference is
the one that should be subject to section
901(m). For example, if there is a cost
recovery amount of 20x due to increased
depreciation deductions related to a U.S.
basis step-up in a CAA, section 901(m)
basically operates to disallow a credit for
foreign taxes on that 20x differential cre-
ated between income for U.S. and foreign
tax purposes. The 2016 proposed regula-
tions take the approach that the partner to
whom the 20x of increased depreciation
is allocated is the one that benefits from
the income differential and is therefore the
one to whom the section 901(m) disallow-
ance should apply. If some other partner
contributed the RFA to the partnership but
does not get an allocation of the increased
depreciation deductions, the Treasury De-
partment and IRS see no policy reason to
nevertheless subject the contributing part-
ner to the section 901(m) disallowance.
5. De miminis threshold
Proposed §1.901(m)-7 describes de
minimis rules under which certain basis
differences are not taken into account for
purposes of section 901(m). In general,
under the 2016 proposed regulations, a
basis difference with respect to an RFA

April 6, 2020 568 Bulletin No. 2020–15
is not taken into account for purposes of
section 901(m) if either (i) the sum of the
basis differences for all RFAs with re-
spect to the CAA is less than the greater
of $10 million or 10 percent of the total
U.S. basis of all RFAs immediately after
the CAA; or (ii) the RFA is part of a class
of RFAs for which the sum of the basis
differences of all RFAs in the class is less
than the greater of $2 million or 10 per-
cent of the total U.S. basis of all RFAs in
the class immediately after the CAA. The
threshold dollar amounts and percentages
to meet the de minimis exemptions for re-
lated-party CAAs are lower than those for
unrelated party CAAs, replacing the terms
“$10 million,” “10 percent,” and “$2 mil-
lion” with the terms “$5 million,” “5 per-
cent,” and “$1 million,” respectively.
One comment expressed the view that
the threshold amounts for the de minimis
rules were too low, noting that the po-
tential basis differential with respect to
transactions of those magnitudes would
not generate a sufficient foreign tax credit
benefit to justify intensive tax planning.
The comment suggested raising the $10
million threshold to $15 million. The
comment also recommended eliminating
the reduced de minimis thresholds in the
context of related-party transactions. The
comment argued that the test should be
different for related parties only if the fact
that the parties are related somehow makes
the rules less burdensome than they are for
unrelated parties or makes the likelihood
of tax arbitrage higher. The comment sug-
gested that this was unlikely to be the case
in the context of section 901(m).
Although the Treasury Department and
the IRS do not believe that the comment
made a compelling argument for increas-
ing the threshold for the cumulative basis
difference exemption, the Treasury De-
partment and IRS agree that it is appropri-
ate to extend the scope of the de minimis
rules in order to further reduce the bur-
den of compliance with the rules. How-
ever, rather than increasing the threshold
amount, the Treasury Department and IRS
have decided to add an additional exclu-
sion, such that a basis difference with re-
spect to an individual RFA is not taken into
account for purposes of section 901(m) if
the basis difference is less than $20,000.
See §1.901(m)-7(b)(4). Like the de mi-
nimis exceptions contained in the 2016
proposed regulations, this de minimis ex-
ception applies independently of the other
de minimis exceptions. Moreover, the re-
duced thresholds for related-party transac-
tions are eliminated, as suggested by the
comment. See §1.901(m)-7(c).
6. Interaction with section 909
One comment requested adding a pri-
ority rule to the regulations to address
transactions to which both section 901(m)
and section 909 apply, such as, for exam-
ple, the acquisition of a reverse hybrid
with respect to which a section 338 elec-
tion is made. The acquisition is a CAA
under section 901(m), and the reverse
hybrid structure is a specified foreign tax
credit splitting event under the section 909
regulations. The comment recommended
that, given the complexity of the calcu-
lation of disqualified tax amounts under
section 901(m), those calculations should
be made first and section 909 should then
be applied to determine whether any of the
remaining foreign taxes are suspended.
The Treasury Department and IRS
agree with the comment that if section
901(m) and section 909 apply to the
same transaction, the section 901(m)
calculations should be undertaken be-
fore applying section 909. However, the
comment’s recommendation implied that
only the portion of the foreign taxes that
are not disqualified under section 901(m)
are subject to potential suspension under
section 909. The Treasury Department
and IRS disagree with this implication.
Section 909 defers taking into account
foreign taxes for purposes of claiming a
foreign tax credit or claiming a deduc-
tion. Foreign taxes that are disqualified for
foreign tax credit purposes under section
901(m) but remain eligible to be deducted
may be subject to deferral under section
909 as well. The comment’s suggestion
is adopted with these clarifications. See
§1.901(m)-8(d).
7. Changes related to the Tax Cuts and
Jobs Act (TCJA)
The final regulations reflect modifica
-
tions to the rules contained in the 2016
proposed regulations necessary to reflect
statutory changes by the TCJA, Public
Law 115–97 (2017). References to section
902 corporations are replaced with refer-
ences to applicable foreign corporations,
which consist of section 902 corporations
before the applicability of the TCJA mod-
ifications to the foreign tax credit rules
and controlled foreign corporations there-
after. See §1.901(m)-1(a)(7). In addition,
a definition of separate category is added
and utilized to address the income group-
ings required under section 960 following
TCJA. See §1.901(m)-1(a)(42).
8. Applicability dates
The 2016 proposed regulations were
generally proposed to apply to CAAs
occurring on or after the date of publica-
tion of the final regulations. However, the
2016 proposed regulations also provid-
ed that taxpayers could rely on the rules
therein before they would otherwise be
applicable, provided that taxpayers con-
sistently applied proposed §1.901(m)-2
(excluding § 1.901(m)-2(d)) to all CAAs
occurring on or after December 7, 2016,
and consistently applied §1.704-1(b)(4)
(viii)(c)(4)(v) through (vii), §1.901(m)-
1, and §§1.901(m)-3 through 1.901(m)-8
(excluding § 1.901(m)–4(e)) to all CAAs
occurring on or after January 1, 2011.
For this purpose, persons that are related
(within the meaning of section 267(b) or
707(b)) were treated as a single taxpayer.
In order to be consistent with the re-
vised applicability of the foreign basis
election, as discussed in Part 3 of this
Summary of Comments and Explanation
of Revisions section, and allow the rules
in the final regulations to be applied retro-
actively, the final regulations provide that
taxpayers may choose to apply the rules
before they would otherwise be applica-
ble, provided that the consistency require-
ments described in the preceding para-
graph are met, on any original or amended
tax return for each taxable year for which
the application of the provisions affects
the tax liability and for which the statute
of limitations does not preclude assess-
ment or the filing of a claim for refund,
as applicable. The relevant tax returns for
taxable years ending before March 23,
2020, must be filed no later than March
23, 2021. In the case of taxable years that
are not open for assessment, appropriate
adjustments must be made to take into ac-
count deficiencies that would have result-

Bulletin No. 2020–15 569 April 6, 2020
ed from the consistent application of the
applicable provisions.
Special Analyses
These final regulations are not subject
to review under section 6(b) of Execu-
tive Order 12866 pursuant to the Mem-
orandum of Agreement (April 11, 2018)
between the Department of the Treasury
and the Office of Management and Budget
regarding review of tax regulations.
Pursuant to the Regulatory Flexibility
Act (5 U.S.C. chapter 6), it is hereby cer-
tified that this regulation will not have a
significant economic impact on a substan-
tial number of small entities. In general,
foreign corporations are not considered
small entities. Nor are U.S. taxpayers
considered small entities to the extent the
taxpayers are natural persons or entities
other than small entities. Small entities
are significantly less likely to engage in
the types of transactions addressed by the
regulations than U.S. multinational corpo-
rations. Moreover, the de minimis rules
discussed in Part 5 of the Summary of
Comments and Explanation of Revisions
section further limit the number of small
entities likely to be subject to the regula-
tions.
Pursuant to section 7805(f), the notice
of proposed rulemaking preceding this
regulation was submitted to the Chief
Counsel for Advocacy of the Small Busi-
ness Administration for comment on its
impact on small business. No comments
were received.
Drafting Information
The principal author of these regula-
tions is Jeffrey L. Parry of the Office of
Associate Chief Counsel (International).
However, other personnel from the Trea-
sury Department and the IRS participated
in their development.
List of Subjects in 26 CFR Part 1
Income taxes, Reporting and record-
keeping requirements.
Amendments to the Regulations
Accordingly, 26 CFR part 1 is amend-
ed as follows:
PART 1—INCOME TAXES
Paragraph 1. The authority citation for
part 1 is amended by removing entries
for §§ 1.901(m)-1T through 1.901(m)-8T
and § 1.901(m)-5T and adding entries for
§§ 1.901(m)-1 through 1.901(m)-8 and §
1.901(m)-5 in numerical order to read as
follows:
Authority: 26 U.S.C. 7805
* * * * *
Sections 1.901(m)-1 through 1.901(m)-8
also issued under 26 U.S.C. 901(m)(7).
Section 1.901(m)-5 also issued under
26 U.S.C. 901(m)(3)(B)(ii).
* * * * *
Par. 2. Section 1.704-1 is amended by
adding paragraphs (b)(1)(ii)(b)(4) and (b)
(4)(viii)(c)(4)(v) through (vii) to read as
follows:
§1.704-1 Partner’s distributive share.
* * * * *
(b) * * *
(1) * * *
(ii) * * *
(b) * * *
(4) Special rules for covered asset ac-
quisitions. Paragraphs (b)(4)(viii)(c)(4)
(v) through (vii) of this section apply to
covered asset acquisitions (CAAs) (as de-
fined in §1.901(m)-1(a)(13)) occurring on
or after March 23, 2020. Taxpayers may,
however, choose to apply paragraphs (b)
(4)(viii)(c)(4)(v) through (vii) of this sec-
tion before the date paragraphs (b)(4)(viii)
(
c)(4)(v) through (vii) of this section are
applicable provided that they (along with
any persons that are related (within the
meaning of section 267(b) or 707(b)) to
the taxpayer)—
(i) Consistently apply paragraphs (b)(4)
(viii)(c)(4)(v) through (vii) of this section,
§1.901(m)-1, and §§1.901(m)-3 through
1.901(m)-8 (excluding §1.901(m)-4(e)) to
all CAAs occurring on or after January 1,
2011, and consistently apply §1.901(m)-2
(excluding §1.901(m)-2(d)) to all CAAs
occurring on or after December 7, 2016,
on any original or amended tax return for
each taxable year for which the application
of the provisions listed in this paragraph
(b)(1)(ii)(b)(4)(i) affects the tax liability
and for which the statute of limitations
does not preclude assessment or the filing
of a claim for refund, as applicable;
(ii) File all tax returns described in
paragraph (b)(1)(ii)(b)(4)(i) of this section
for any taxable year ending on or before
March 23, 2020, no later than March 23,
2021; and
(iii) Make appropriate adjustments to
take into account deficiencies that would
have resulted from the consistent applica-
tion under paragraph (b)(1)(ii)(b)(4)(i) of
this section for taxable years that are not
open for assessment.
* * * * *
(4) * * *
(viii) * * *
(c) * * *
(4) * * *
(v) Adjustments related to section
901(m). If one or more assets owned by a
partnership are relevant foreign assets (or
RFAs) with respect to a foreign income
tax, then, solely for purposes of applying
the safe harbor provisions of paragraph
(b)(4)(viii)(a)(1) of this section to alloca-
tions of CFTEs with respect to that foreign
income tax, the net income in a CFTE cat-
egory that includes partnership items of
income, deduction, gain, or loss attribut-
able to the RFA shall be increased by the
amount described in paragraph (b)(4)(viii)
(c)(4)(vi) of this section and reduced by
the amount described in paragraph (b)(4)
(viii)(c)(4)(vii) of this section. Similarly,
a partner’s CFTE category share of in-
come shall be increased by the portion of
the amount described in paragraph (b)(4)
(viii)(c)(4)(vi) of this section that is allo-
cated to the partner under §1.901(m)-5(d)
and reduced by the portion of the amount
described in paragraph (b)(4)(viii)(c)(4)
(vii) of this section that is allocated to
the partner under §1.901(m)-5(d). The
principles of this paragraph (b)(4)(viii)
(c)(4)(v) apply similarly when a partner-
ship owns an RFA indirectly through one
or more other partnerships. For purposes
of this paragraph (b)(4)(viii)(c)(4)(v) and
paragraphs (b)(4)(viii)(c)(4)(vi) and (b)
(4)(viii)(c)(4)(vii) of this section, basis
difference is defined in §1.901(m)-4, cost
recovery amount is defined in §1.901(m)-
5(b)(2), disposition amount is defined in
§1.901(m)-5(c)(2), foreign income tax
is defined in §1.901(m)-1(a)(26), RFA is
defined in §1.901(m)-2(c), U.S. dispo-
sition gain is defined in §1.901(m)-1(a)
(52), and U.S. disposition loss is defined
in §1.901(m)-1(a)(53).
(vi) Adjustment amounts for RFAs
with a positive basis difference. With re-

April 6, 2020 570 Bulletin No. 2020–15
spect to RFAs with a positive basis dif-
ference, the amount referenced in para-
graph (b)(4)(viii)(c)(4)(v) of this section
is the sum of any cost recovery amounts
and disposition amounts attributable to
U.S. disposition loss that correspond to
partnership items that are included in the
net income in the CFTE category and
that are taken into account for the U.S.
taxable year of the partnership under
§1.901(m)-5(d).
(vii) Adjustment amounts for RFAs with
a negative basis difference. With respect
to RFAs with a negative basis difference,
the amount referenced in paragraph (b)(4)
(viii)(c)(4)(v) of this section is the sum of
any cost recovery amounts and disposition
amounts attributable to U.S. disposition
gain that correspond to partnership items
that are included in the net income in the
CFTE category and that are taken into ac-
count for the U.S. taxable year of the part-
nership under §1.901(m)-5(d).
* * * * *
Par. 3. Section 1.901(m)-1 is added to
read as follows:
§1.901(m)-1 Definitions.
(a) Definitions. For purposes of section
901(m), this section, and §§1.901(m)-2
through 1.901(m)-8, the following defini-
tions apply:
(1) The term aggregate basis differ-
ence means, with respect to a foreign
income tax and a foreign payor, the sum
of the allocated basis differences and the
allocated basis difference adjustments for
a U.S. taxable year of a section 901(m)
payor, plus any aggregate basis differ-
ence carryover from the immediately
preceding U.S. taxable year of the section
901(m) payor with respect to the foreign
income tax and foreign payor, as adjust-
ed under §1.901(m)-6(c). For purposes
of this definition, if foreign law imposes
tax on the combined income (within the
meaning of §1.901-2(f)(3)(ii)) of two or
more foreign payors, all foreign payors
whose items of income, deduction, gain,
or loss are included in the U.S. taxable
income or earnings and profits of the sec-
tion 901(m) payor are treated as a single
foreign payor. Aggregate basis difference
is determined with respect to each sepa-
rate category.
(2) The term aggregate basis difference
carryover has the meaning provided in
§1.901(m)-3(c).
(3) The term aggregated CAA transac-
tion means a series of related CAAs oc-
curring as part of a plan.
(4) The term allocable foreign income
means the portion of foreign income of a
foreign payor that relates to the foreign in-
come tax amount of the foreign payor that
is paid or accrued by, or considered paid
or accrued by, a section 901(m) payor.
(5) The term allocated basis difference
means, with respect to an RFA and a for-
eign income tax, the sum of the cost re-
covery amounts and disposition amounts
assigned to a U.S. taxable year of the sec-
tion 901(m) payor under §1.901(m)-5.
(6) The term allocated basis differ-
ence adjustment means an adjustment to
a section 901(m) payor’s allocated basis
difference with respect to an RFA and a
foreign income tax for a U.S. taxable year.
If the RFA has a positive basis difference,
the allocated basis difference adjustment
is equal to the lesser of the allocated ba-
sis difference or the portion of any un-
allocated CAA gain that corresponds to
the CAA gain recognized by the section
901(m) payor or a member of the section
901(m) payor’s consolidated group. If the
RFA has a negative basis difference, the
allocated basis difference adjustment is
equal to the greater of the allocated basis
difference or the portion of any unallocat-
ed CAA loss that corresponds to the CAA
loss recognized by the section 901(m)
payor or a member of the section 901(m)
payor’s consolidated group. For purposes
of this paragraph, CAA gain or CAA loss
recognized by the section 901(m) payor or
a member of the section 901(m) payor’s
consolidated group includes their distrib-
utive share of CAA gain or CAA loss rec-
ognized by a partnership.
(7) The term applicable foreign corpo-
ration means—
(i) For taxable years of foreign corpo-
rations beginning before January 1, 2018,
a section 902 corporation (as defined in
section 909(d)(5) (as in effect on Decem-
ber 21, 2017)), and
(ii) For taxable years of foreign cor-
porations beginning after December 31,
2017, a controlled foreign corporation (as
defined in section 957).
(8) The term basis difference has the
meaning provided in §1.901(m)-4.
(9) The term CAA gain means the
amount of gain recognized with respect to
an RFA for U.S. tax purposes as a result
of a CAA.
(10) The term CAA loss means the
amount of loss recognized with respect to
an RFA for U.S. tax purposes as a result
of a CAA.
(11) The term consolidated group has
the meaning provided in §1.1502-1(h).
(12) The term cost recovery amount
has the meaning provided in §1.901(m)-
5(b)(2).
(13) The term covered asset acquisi-
tion (or CAA) has the meaning provided
in §1.901(m)-2.
(14) The term cumulative basis differ-
ence exemption has the meaning provided
in §1.901(m)-7(b)(2).
(15) The term disposition means an
event (for example, a sale, abandonment,
or mark-to-market event) that results in
gain or loss being recognized with respect
to an RFA for purposes of U.S. income tax
or a foreign income tax, or both.
(16) The term disposition amount has
the meaning provided in §1.901(m)-5(c)
(2).
(17) The term disqualified tax amount
has the meaning provided in §1.901(m)-
3(b).
(18) The term disregarded entity means
an entity that is disregarded as an entity
separate from its owner, as described in
§301.7701-2(c)(2)(i) of this chapter.
(19) The term fiscally transparent enti-
ty means an entity, including a disregarded
entity, that is fiscally transparent under the
principles of §1.894-1(d)(3) for purposes
of U.S. income tax or a foreign income tax
(or both).
(20) The term foreign basis means the
adjusted basis of an asset determined for
purposes of a foreign income tax.
(21) The term foreign basis election has
the meaning provided in §1.901(m)-4(c).
(22) The term foreign country credit-
able tax (or FCCT) means, with respect to
a foreign income tax amount, the amount
of income, war profits, or excess profits
tax paid or accrued to a foreign country
or possession of the United States and
claimed as a foreign tax credit for pur-
poses of determining the foreign income
tax amount. To qualify as a FCCT, the tax
imposed by the foreign country or pos-
session must be a foreign income tax or
a withholding tax determined on a gross
basis as described in section 901(k)(1)(B).

Bulletin No. 2020–15 571 April 6, 2020
(23) The term foreign disposition gain
means, with respect to a foreign income
tax, the amount of gain recognized on a
disposition of an RFA in determining for-
eign income, regardless of whether the
gain is deferred or otherwise not taken
into account currently. Notwithstanding
the foregoing, if after a section 743(b)
CAA there is a disposition of an asset
that is an RFA with respect to that section
743(b) CAA, foreign disposition gain has
the meaning provided in §1.901(m)-5(c)
(2)(iii).
(24) The term foreign disposition loss
means, with respect to a foreign income
tax, the amount of loss recognized on a
disposition of an RFA in determining for-
eign income, regardless of whether the
loss is deferred or disallowed or otherwise
not taken into account currently. Notwith-
standing the foregoing, if after a section
743(b) CAA there is a disposition of an as-
set that is an RFA with respect to that sec-
tion 743(b) CAA, foreign disposition loss
has the meaning provided in §1.901(m)-
5(c)(2)(iii).
(25) The term foreign income means,
with respect to a foreign income tax, the
taxable income (or loss) reflected on a for-
eign tax return (as properly amended or
adjusted), even if the taxable income (or
loss) is reported by an entity that is a fis-
cally transparent entity for purposes of the
foreign income tax. If, however, foreign
law imposes tax on the combined income
(within the meaning of §1.901-2(f)(3)(ii))
of two or more foreign payors, foreign in-
come means the combined taxable income
(or loss) of such foreign payors, regardless
of whether such income (or loss) is reflect-
ed on a single foreign tax return.
(26) The term foreign income tax means
an income, war profits, or excess profits
tax for which a credit is allowable under
section 901 or section 903, except that it
does not include any withholding tax de-
termined on a gross basis as described in
section 901(k)(1)(B).
(27) The term foreign income tax
amount means, with respect to a foreign
income tax, the amount of tax (including
an amount of tax that is zero) reflected on
a foreign tax return (as properly amended
or adjusted). If foreign law imposes tax on
the combined income (within the mean-
ing of §1.901-2(f)(3)(ii)) of two or more
foreign payors, however, a foreign income
tax amount means the amount of tax im-
posed on the combined income, regardless
of whether the tax is reflected on a single
foreign tax return.
(28) The term foreign payor means
an individual or entity (including a dis-
regarded entity) subject to a foreign in-
come tax. If foreign law imposes tax on
the combined income (within the mean-
ing of §1.901-2(f)(3)(ii)) of two or more
individuals or entities, each such individ-
ual or entity is a foreign payor. An indi-
vidual or entity may be a foreign payor
with respect to more than one foreign
income tax for purposes of applying sec-
tion 901(m).
(29) The term foreign taxable year
means a taxable year for purposes of a
foreign income tax.
(30) The term mid-year transaction
means a transaction in which a foreign
payor that is a corporation or a disregard-
ed entity has a change in ownership or
makes an election pursuant to §301.7701-
3 to change its entity classification, or a
transaction in which a foreign payor that
is a partnership terminates under section
708(b)(1), provided in each case that the
foreign payor’s foreign taxable year does
not close as a result of the transaction,
and, if the foreign payor is a corporation
or a partnership, the foreign payor’s U.S.
taxable year closes.
(31) The term prior CAA has the mean-
ing provided in §1.901(m)-6(b)(2).
(32) The term prior section 743(b) CAA
has the meaning provided in §1.901(m)-
6(b)(4)(iii).
(33) The term relevant foreign asset
(or R FA) has the meaning provided in
§1.901(m)-2.
(34) The term reverse hybrid has the
meaning provided in §1.909-2(b)(1)(iv).
(35) The term RFA class exemption has
the meaning provided in §1.901(m)-7(b)
(3).
(36) The term RFA exemption has the
meaning provided in §1.901(m)-7(b)(4).
(37) The term RFA owner (U.S.) means
a person that owns an RFA for U.S. in-
come tax purposes.
(38) The term RFA owner (foreign)
means an individual or entity (including a
disregarded entity) that owns an RFA for
purposes of a foreign income tax.
(39) The term section 338 CAA has the
meaning provided in §1.901(m)-2(b)(1).
(40) The term section 743(b) CAA has
the meaning provided in §1.901(m)-2(b)
(3).
(41) The term section 901(m) pay-
or means a person eligible to claim the
foreign tax credit allowed under section
901(a), regardless of whether the person
chooses to claim the foreign tax credit, as
well as an applicable foreign corporation.
Each member of a consolidated group is
a separate section 901(m) payor. If indi-
viduals file a joint return, those individu-
als are treated as a single section 901(m)
payor.
(42) The term separate category
means each separate category described
in §1.904-5(a)(4)(v), and in the case of an
applicable foreign corporation described
in paragraph (a)(7)(ii) of this section, each
income group described in §1.960-1(d)(2)
(ii).
(43) The term subsequent CAA has the
meaning provided in §1.901(m)-6(b)(4)
(i).
(44) The term subsequent section
743(b) CAA has the meaning provided in
§1.901(m)-6(b)(4)(iii).
(45) The term successor transaction
has the meaning provided in §1.901(m)-
6(b)(2).
(46) The term tentative disqualified
tax amount has the meaning provided in
§1.901(m)-3(b)(2)(ii).
(47) The term unallocated basis differ-
ence means, with respect to an RFA and
a foreign income tax, the basis difference
reduced by the sum of the cost recovery
amounts and the disposition amounts that
have been computed under §1.901(m)-5.
(48) The term unallocated CAA gain
means, with respect to an RFA, the CAA
gain reduced by the sum of the allocated
basis difference adjustments that have
been computed with respect to the RFA.
(49) The term unallocated CAA loss
means, with respect to an RFA, the CAA
loss reduced by the sum of the allocated
basis difference adjustments that have
been computed with respect to the RFA.
(50) The term U.S. basis means the
adjusted basis of an asset determined for
U.S. income tax purposes.
(51) The term U.S. basis deduction has
the meaning provided in §1.901(m)-5(b)
(3).
(52) The term U.S. disposition gain
means the amount of gain recognized for

April 6, 2020 572 Bulletin No. 2020–15
U.S. income tax purposes on a disposition
of an RFA, regardless of whether the gain
is deferred or otherwise not taken into ac-
count currently. Notwithstanding the fore-
going, if after a section 743(b) CAA there
is a disposition of an asset that is an RFA
with respect to that section 743(b) CAA,
U.S. disposition gain has the meaning pro-
vided in §1.901(m)-5(c)(2)(iii).
(53) The term U.S. disposition loss
means the amount of loss recognized for
U.S. income tax purposes on a disposition
of an RFA, regardless of whether the loss
is deferred or disallowed or otherwise not
taken into account currently. Notwith-
standing the foregoing, if after a section
743(b) CAA there is a disposition of an
asset that is an RFA with respect to that
section 743(b) CAA, U.S. disposition loss
has the meaning provided in §1.901(m)-
5(c)(2)(iii).
(54) The term U.S. taxable year means
a taxable year as defined in section 7701(a)
(23).
(b) Applicability dates. (1) Except as
provided in paragraph (b)(2) of this sec-
tion, this section applies to CAAs occur-
ring on or after March 23, 2020.
(2) Paragraphs (a)(8), (12), (13), (15),
(16), (18), (19), (23) through (26), (31)
through (33), (39), (40), (43) through
(45), (47), (50), and (52) through (54) of
this section apply to CAAs occurring on
or after July 21, 2014, and to CAAs oc-
curring before that date resulting from an
entity classification election made under
§301.7701-3 that is filed on or after July
29, 2014, and that is effective on or before
July 21, 2014. Paragraphs (a)(8), (12),
(13), (15), (16), (18), (19), (23) through
(26) through (33), (39), (40), (43) through
(45), (47), (50), and (52) through (54) of
this section also apply to CAAs occurring
on or after January 1, 2011, and before
July 21, 2014, other than CAAs occurring
before July 21, 2014, resulting from an
entity classification election made under
§301.7701-3 that is filed on or after July
29, 2014, and that is effective on or be-
fore July 21, 2014, but only if the basis
difference (within the meaning of section
901(m)(3)(C)(i)) in one or more RFAs
with respect to the CAA had not been fully
taken into account under section 901(m)
(3)(B) either as of July 21, 2014, or, in
the case of an entity classification election
made under §301.7701-3 that is filed on or
after July 29, 2014, and that is effective on
or before July 21, 2014, before the trans-
actions that are deemed to occur under
§301.7701-3(g) as a result of the change
in classification.
(3) Taxpayers may, however, choose
to apply provisions in this section before
the date such provisions are applicable
pursuant to paragraph (b)(1) or (2) of this
section, provided that they (along with
any persons that are related (within the
meaning of section 267(b) or 707(b)) to
the taxpayer)—
(i) Consistently apply this section,
§1.704-1(b)(4)(viii)(c)(4)(v) through (vii),
and §§1.901(m)-3 through 1.901(m)-8
(excluding §1.901(m)-4(e)) to all CAAs
occurring on or after January 1, 2011, and
consistently apply §1.901(m)-2 (exclud-
ing §1.901(m)-2(d)) to all CAAs occur-
ring on or after December 7, 2016, on any
original or amended tax return for each
taxable year for which the application of
the provisions listed in this paragraph (b)
(3)(i) affects the tax liability and for which
the statute of limitations does not preclude
assessment or the filing of a claim for re-
fund, as applicable;
(ii) File all tax returns described in
paragraph (b)(3)(i) of this section for any
taxable year ending on or before March
23, 2020, no later than March 23, 2021;
and
(iii) Make appropriate adjustments to
take into account deficiencies that would
have resulted from the consistent applica-
tion under paragraph (b)(3)(i) of this sec-
tion for taxable years that are not open for
assessment.
§1.901(m)-1T [Removed]
Par. 4. Section 1.901(m)-1T is re-
moved.
Par. 5. Section 1.901(m)-2 is added to
read as follows:
§1.901(m)-2 Covered asset acquisitions
and relevant foreign assets.
(a) In general
. Paragraph (b) of this
section sets forth the transactions that are
covered asset acquisitions (or CAAs).
Paragraph (c) of this section provides rules
for identifying assets that are relevant for-
eign assets (or RFAs) with respect to a
CAA. Paragraph (d) of this section pro-
vides special rules for identifying CAAs
and RFAs with respect to transactions to
which paragraphs (b) and (c) of this sec-
tion do not apply. Paragraph (e) of this
section provides examples illustrating the
rules of this section, and paragraph (f) of
this section provides applicability dates.
(b) Covered asset acquisitions. Except
as provided in paragraph (d) of this sec-
tion, the transactions set forth in this para-
graph (b) are CAAs.
(1) A qualified stock purchase (as de-
fined in section 338(d)(3)) to which sec-
tion 338(a) applies (section 338 CAA);
(2) Any transaction that is treated as an
acquisition of assets for U.S. income tax
purposes and treated as an acquisition of
stock of a corporation (or disregarded) for
foreign income tax purposes;
(3) Any acquisition of an interest in a
partnership that has an election in effect
under section 754 (section 743(b) CAA);
(4) Any transaction (or series of trans-
actions occurring pursuant to a plan) to
the extent it is treated as an acquisition of
assets for purposes of U.S. income tax and
as the acquisition of an interest in a fis-
cally transparent entity for purposes of a
foreign income tax;
(5) Any transaction (or series of trans-
actions occurring pursuant to a plan) to the
extent it is treated as a partnership distri-
bution of one or more assets the U.S. basis
of which is determined by section 732(b)
or 732(d) or to the extent it causes the
U.S. basis of the partnership’s remaining
assets to be adjusted under section 734(b),
provided the transaction results in an in-
crease in the U.S. basis of one or more of
the assets distributed by the partnership or
retained by the partnership without a cor-
responding increase in the foreign basis of
such assets; and
(6) Any transaction (or series of trans-
actions occurring pursuant to a plan) to
the extent it is treated as an acquisition of
assets for purposes of both U.S. income
tax and a foreign income tax, provided
the transaction results in an increase in
the U.S. basis without a corresponding in-
crease in the foreign basis of one or more
assets.
(c) Relevant foreign asset—(1) In gen-
eral. Except as provided in paragraph (d)
of this section, an RFA means, with re-
spect to a foreign income tax and a CAA,
any asset (including goodwill, going con-

Bulletin No. 2020–15 573 April 6, 2020
cern value, or other intangible) subject to
the CAA that is relevant in determining
foreign income for purposes of the foreign
income tax.
(2) RFA status with respect to a foreign
income tax. An asset is relevant in deter-
mining foreign income if income, deduc-
tion, gain, or loss attributable to the asset
is taken into account in determining for-
eign income immediately after the CAA,
or would be taken into account in deter-
mining foreign income immediately after
the CAA if the asset were to give rise to
income, deduction, gain, or loss at such
time.
(3) Subsequent RFA status with re-
spect to another foreign income tax. Af-
ter a CAA, an asset will become an RFA
with respect to another foreign income tax
if, pursuant to a plan or series of related
transactions that have a principal purpose
of avoiding the application of section
901(m), an asset that was not relevant in
determining foreign income for purposes
of that foreign income tax immediately
after the CAA becomes relevant in deter-
mining such foreign income. A principal
purpose of avoiding section 901(m) will
be deemed to exist if income, deduction,
gain, or loss attributable to the asset is
taken into account in determining such
foreign income within the one-year peri-
od following the CAA, or would be taken
into account in determining such foreign
income during such time if the asset were
to give rise to income, deduction, gain, or
loss within the one-year period.
(d) Identifying covered asset acquisi-
tions and relevant foreign assets to which
paragraphs (b) and (c) of this section do
not apply. For transactions occurring on or
after January 1, 2011, and before July 21,
2014, other than transactions occurring
before July 21, 2014, resulting from an
entity classification election made under
§301.7701-3 of this chapter that is filed on
or after July 29, 2014, and that is effective
on or before July 21, 2014, the transac-
tions set forth under section 901(m)(2) are
CAAs and the assets that are relevant for-
eign assets with respect to the CAA under
section 901(m)(4) are RFAs.
(e) Examples. The following examples
illustrate the rules of this section:
(1) Example 1: CAA involving an acquisition of
a partnership interest for foreign income tax pur-
poses—(i) Facts. (A) FPS is an entity organized in
Country F that is treated as a partnership for both
U.S. and Country F income tax purposes. FPS is
owned equally by FC1 and FC2, each of which is
a corporation organized in Country F and treated as
a corporation for both U.S. and Country F income
tax purposes. FPS has a single asset, Asset A. USP, a
domestic corporation, owns all the interests in DE, a
disregarded entity.
(B) Pursuant to the same transaction, USP ac-
quires FC1’s interest in FPS, and DE acquires FC2’s
interest in FPS. For U.S. income tax purposes, with
respect to USP, the acquisition of the interests in FPS
is treated as the acquisition of Asset A by USP. See
Rev. Rul. 99-6, 1999-1 C.B. 432. For Country F tax
purposes, the acquisitions of the interests of FPS by
USP and DE are treated as acquisitions of partner-
ship interests.
(ii) Result. The transaction is a CAA under para-
graph (b)(4) of this section because it is treated as the
acquisition of Asset A for U.S. income tax purposes
and the acquisition of interests in a fiscally transpar-
ent entity for Country F tax purposes.
(2) Example 2: CAA involving an asset acqui-
sition for purposes of both U.S. income tax and a
foreign income tax—(i) Facts. (A) USP, a domestic
corporation, wholly owns CFC1, a foreign corpora-
tion, and CFC1 wholly owns CFC2, also a foreign
corporation. CFC1 and CFC2 are organized in Coun-
try F. CFC1 owns Asset A.
(B) In an exchange described in section 351,
CFC1 transfers Asset A to CFC2 in exchange for
CFC2 common stock and cash. CFC1 recognizes
gain on the exchange under section 351(b). Under
section 362(a), CFC2’s U.S. basis in Asset A is in-
creased by the gain recognized by CFC1. For Coun-
try F tax purposes, gain or loss is not recognized on
the transfer of Asset A to CFC2, and therefore there
is no increase in the foreign basis in Asset A.
(ii) Result. The transaction is a CAA under para-
graph (b)(6) of this section because it is treated as
an acquisition of Asset A by CFC2 for both U.S. and
Country F income tax purposes, and it results in an
increase in the U.S. basis of Asset A without a cor-
responding increase in the foreign basis of Asset A.
(3) Example 3: RFA status determined immedi-
ately after CAA; application of principal purpose
rule—(i) Facts. (A) USP1 and USP2 are unrelated
domestic corporations. USP1 wholly owns USSub,
also a domestic corporation. On January 1 of Year 1,
USP2 acquires all of the stock of USSub from USP1
in a qualified stock purchase (as defined in section
338(d)(3)) to which section 338(a) applies. Immedi-
ately after the acquisition, none of the income, de-
duction, gain, or loss attributable to any of the assets
of USSub is taken into account in determining for-
eign income for purposes of a foreign income tax nor
would such items be taken into account in determin-
ing foreign income for purposes of a foreign income
tax immediately after the acquisition if such assets
were to give rise to income, deduction, gain, or loss
immediately after the acquisition.
(B) On December 1 of Year 1, USSub contributes
all its assets to FSub, its wholly owned subsidiary,
which is a corporation for both U.S. and Country X
income tax purposes, in a transfer described in section
351 (subsequent transfer). USSub recognizes no gain
or loss for U.S. or Country X income tax purposes as
a result of the subsequent transfer. As a result of the
subsequent transfer, income, deduction, gain, or loss
attributable to the assets of USSub that were trans-
ferred to FSub is taken into account in determining
foreign income of FSub for Country X tax purposes.
(ii) Result. (A) Under paragraph (b)(1) of this
section, the acquisition by USP2 of the stock of US-
Sub is a section 338 CAA. Under paragraph (c)(1) of
this section, none of the assets of USSub are RFAs
immediately after the CAA, because none of the in-
come, deduction, gain, or loss attributable to such as-
sets is taken into account for purposes of determining
foreign income with respect to any foreign income
tax immediately after the CAA (nor would such
items be taken into account for purposes of deter-
mining foreign income immediately after the CAA
if such assets were to give rise to income, deduction,
gain, or loss at such time).
(B) Although the subsequent transfer is not a
CAA under paragraph (b) of this section, the sub-
sequent transfer causes the assets of USSub to be-
come relevant in the hands of FSub in determining
foreign income for Country X tax purposes. Because
the subsequent transfer occurred within the one-year
period following the CAA, it is presumed to have a
principal purpose of avoiding section 901(m) under
paragraph (c)(3) of this section. Accordingly, the as-
sets of USSub with respect to the CAA occurring on
January 1 of Year 1 become RFAs with respect to
Country X tax as a result of the subsequent transfer.
Thus, a basis difference with respect to Country X
tax must be computed for the RFAs and taken into
account under section 901(m).
(f) Applicability dates. (1) Except as
provided in paragraph (f)(2) of this sec-
tion, this section applies to CAAs oc-
curring on or after [INSERT DATE OF
PUBLICATION IN THE FEDERAL REG-
ISTER].
(2) Paragraphs (a), (b)(1) through (3),
and (c)(1) of this section apply to transac-
tions occurring on or after July 21, 2014,
and to transactions occurring before that
date resulting from an entity classifica-
tion election made under §301.7701-3 of
this chapter that is filed on or after July
29, 2014, and that is effective on or be-
fore July 21, 2014. Paragraph (d) of this
section applies to transactions occurring
on or after January 1, 2011, and before
July 21, 2014, other than transactions
occurring before July 21, 2014, resulting
from an entity classification election made
under §301.7701-3 of this chapter that is
filed on or after July 29, 2014, and that is
effective on or before July 21, 2014.
(3) Taxpayers may, however, choose
to apply provisions in this section before
the date such provisions are applicable
pursuant to paragraph (f)(1) or (2) of this
section, provided that they (along with
any persons that are related (within the
meaning of section 267(b) or 707(b)) to
the taxpayer)—

April 6, 2020 574 Bulletin No. 2020–15
(i) Consistently apply this section (ex-
cluding paragraph (d) of this section) to all
CAAs occurring on or after December 7,
2016 and consistently apply §1.704-1(b)
(4)(viii)(c)(4)(v) through (vii), §1.901(m)-
1, and §§1.901(m)-3 through 1.901(m)-8
(excluding §1.901(m)-4(e)) to all CAAs
occurring on or after January 1, 2011, on
any original or amended tax return for
each taxable year for which the applica-
tion of the provisions listed in this para-
graph (f)(3)(i) affects the tax liability and
for which the statute of limitations does
not preclude assessment or the filing of a
claim for refund, as applicable;
(ii) File all tax returns described in para-
graph (f)(3)(i) of this section for any tax-
able year ending on or before March 23,
2020, no later than March 23, 2021; and
(iii) Make appropriate adjustments to
take into account deficiencies that would
have resulted from the consistent applica-
tion under paragraph (f)(3)(i) of this sec-
tion for taxable years that are not open for
assessment.
§1.901(m)-2T [Removed]
Par. 6. Section 1.901(m)-2T is re-
moved.
Par. 7. Section 1.901(m)-3 is added to
read as follows:
§1.901(m)-3 Disqualified tax amount
and aggregate basis difference
carryover.
(a) In general. If a section 901(m)
payor has an aggregate basis difference,
with respect to a foreign income tax and a
foreign payor, for a U.S. taxable year, the
section 901(m) payor must determine the
portion of a foreign income tax amount
that is disqualified under section 901(m)
(disqualified tax amount). Paragraph (b)
of this section provides rules for determin-
ing the disqualified tax amount. Paragraph
(c) of this section provides rules for deter-
mining what portion, if any, of aggregate
basis difference will be carried forward to
the next U.S. taxable year (aggregate ba-
sis difference carryover). Paragraph (d) of
this section provides applicability dates.
(b) Disqualified tax amount—(1) In
general. A section 901(m) payor’s disqual-
ified tax amount is not taken into account
in determining the credit allowed under
section 901(a). If the section 901(m) pay-
or is an applicable foreign corporation, the
disqualified tax amount is not taken into
account for purposes of section 902 (for
tax years of foreign corporations begin-
ning before January 1, 2018) or 960. Sec-
tions 78 and 275 do not apply to the dis-
qualified tax amount. The disqualified tax
amount is allowed as a deduction to the
extent otherwise deductible. See sections
164, 212, and 964 and the regulations un-
der those sections.
(2) Determination of disqualified tax
amount—(i) In general. Except as provid-
ed in paragraph (b)(2)(iv) of this section,
the disqualified tax amount is equal to the
lesser of the foreign income tax amount
that is paid or accrued by, or considered
paid or accrued by, the section 901(m)
payor for the U.S. taxable year or the ten-
tative disqualified tax amount. All calcula-
tions are determined with respect to each
separate category.
(ii) Tentative disqualified tax amount.
The tentative disqualified tax amount is
equal to the amount determined under
paragraph (b)(2)(ii)(A) of this section re-
duced (but not below zero) by the amount
described in paragraph (b)(2)(ii)(B) of this
section.
(A) The product of—
(1) The sum of the foreign income tax
amount and the FCCTs that are paid or
accrued by, or considered paid or accrued
by, the section 901(m) payor, and
(2) A fraction, the numerator of which
is the aggregate basis difference, but not
in excess of the allocable foreign income,
and the denominator of which is the allo-
cable foreign income.
(B) The amount of the FCCT that is
a disqualified tax amount of the section
901(m) payor with respect to another for-
eign income tax.
(iii) Allocable foreign income—(A) No
allocation required. Except as provided
in paragraph (b)(2)(iii)(D) of this section,
if the entire foreign income tax amount is
paid or accrued by, or considered paid or
accrued by, a single section 901(m) payor,
then the allocable foreign income is equal
to the entire foreign income, determined
with respect to each separate category.
(B) Allocation required. Except as pro-
vided in paragraph (b)(2)(iii)(D) of this
section, if the foreign income tax amount
is allocated to, and considered paid or ac-
crued by, more than one person, a section
901(m) payor’s allocable foreign income
is equal to the portion of the foreign in-
come that relates to the foreign income tax
amount allocated to that section 901(m)
payor, determined with respect to each
separate category.
(C) Rules for allocations. This para-
graph (b)(2)(iii)(C) provides allocation
rules that apply to determine allocable
foreign income in certain cases.
(1) If the foreign payor is involved
in a mid-year transaction and the for-
eign income tax amount is allocated un-
der §1.336-2(g)(3)(ii), §1.338-9(d), or
§1.901-2(f)(4), then, to the extent any
portion of the foreign income tax amount
is allocated to, and considered paid or
accrued by, a section 901(m) payor, the
allocable foreign income of the section
901(m) payor is determined in accor-
dance with the principles of §1.1502-
76(b). To the extent the foreign income
tax amount is allocated to an entity that
is a partnership for U.S. income tax pur-
poses, a portion of the foreign income is
first allocated to the partnership in ac-
cordance with the principles of §1.1502-
76(b), which is then allocated under the
rules of paragraph (b)(2)(iii)(C)(2) of
this section to determine the allocable
foreign income of a section 901(m) pay-
or that owns an interest in the partnership
directly or indirectly through one or more
other partnerships for U.S. income tax
purposes.
(2) If the foreign income tax amount
is considered paid or accrued by a sec-
tion 901(m) payor for a U.S. taxable year
under §1.702-1(a)(6), the determination
of the allocable foreign income must be
consistent with the allocation of the for-
eign income tax amount that relates to the
foreign income. See §1.704-1(b)(4)(viii).
(3) If the foreign income tax amount
that is allocated to, and considered paid
or accrued by, a section 901(m) payor for
a U.S. taxable year is determined under
§1.901-2(f)(3)(i), the allocable foreign
income is determined in accordance with
§1.901-2(f)(3)(iii).
(D) Failure to substantiate allocable
foreign income. If, pursuant to section
901(m)(3)(A), a section 901(m) payor
fails to substantiate its allocable foreign
income to the satisfaction of the Secretary,
then allocable foreign income will equal

Bulletin No. 2020–15 575 April 6, 2020
the amount determined by dividing the
sum of the foreign income tax amount and
the FCCTs that are paid or accrued by, or
considered paid or accrued by, the section
901(m) payor, by the highest marginal tax
rate applicable to income of the foreign
payor under foreign tax law.
(iv) Special rule. A section 901(m)
payor’s disqualified tax amount is zero for
a U.S. taxable year if:
(A) The section 901(m) payor’s aggre-
gate basis difference for the U.S. taxable
year is a negative amount;
(B) Foreign income is less than or
equal to zero for the foreign taxable year
of the foreign payor; or
(C) The foreign income tax amount
that is paid or accrued by, or considered
paid or accrued by, the section 901(m)
payor for the U.S. taxable year is zero.
(3) Examples. The following examples
illustrate the rules of paragraph (b)(2) of
this section. For purposes of all the ex-
amples, unless otherwise specified: USP
is a domestic corporation. CFC1, CFC2,
DE1, and DE2 are organized in Coun-
try F and are treated as corporations for
Country F tax purposes. CFC1 and CFC2
are applicable foreign corporations. DE1
and DE2 are disregarded entities. USP,
CFC1, and CFC2 each have a calendar
year for both U.S. and Country F income
tax purposes, and DE1 and DE2 each
have a calendar year for Country F tax
purposes. Country F and Country G each
impose a single tax that is a foreign in-
come tax. CFC1, CFC2, DE1, and DE2
each have a functional currency of the u
with respect to all activities. At all rel-
evant times, 1u equals $1. All amounts
are stated in millions. The examples as-
sume that the applicable cost recovery
method for property results in basis be-
ing recovered ratably over the life of the
property beginning on the first day of the
U.S. taxable year in which the property
is acquired or placed into service; there
is a single separate category with respect
to a foreign income and foreign income
tax amount; and a section 901(m) pay-
or properly substantiates its allocable
foreign income to the satisfaction of the
Secretary.
(i) Example 1: Determining aggregate basis
difference; multiple foreign payors—(A) Facts.
CFC1 wholly owns CFC2 and DE1. DE1 wholly
owns DE2. Assume that the tax laws of Country F
do not allow combined income reporting or the fil-
ing of consolidated income tax returns. Accordingly,
CFC1, CFC2, DE1, and DE2 file separate tax returns
for Country F tax purposes. USP acquires all of the
stock of CFC1 in a qualified stock purchase (as de-
fined in section 338(d)(3)) to which section 338(a)
applies for both CFC1 and CFC2.
(B) Result. (1) The acquisition of CFC1 gives
rise to four separate CAAs under §1.901(m)-2(b).
The acquisition of the stock of CFC1 and the deemed
purchase of the stock of CFC2 under section 338(h)
(3)(B) are each a section 338 CAA under §1.901(m)-
2(b)(1). Furthermore, because the deemed purchase
of the assets of DE1 and DE2 for U.S. income tax
purposes is disregarded for Country F tax purpos-
es, each acquisition is a CAA under §1.901(m)-2(b)
(2). Because these four CAAs occur pursuant to a
plan, under §1.901(m)-1(a)(3) they are part of an
aggregated CAA transaction. Under §1.901(m)-1(a)
(37), CFC1 is the RFA owner (U.S.) with respect to
its assets and those of DE1 and DE2. CFC2 is the
RFA owner (U.S.) with respect to its assets. Under
§1.901(m)-1(a)(28), CFC1, CFC2, DE1, and DE2
are each a foreign payor for Country F tax purpos-
es. Under §1.901(m)-1(a)(41), CFC1 is the section
901(m) payor with respect to foreign income tax
amounts for which CFC1, DE1, and DE2 are the for-
eign payors (see §1.901-2(f)(1) and (f)(4)(ii)). CFC2
is the section 901(m) payor with respect to foreign
income tax amounts for which CFC2 is the foreign
payor (see §1.901-2(f)(1)).
(2) In determining aggregate basis difference
under §1.901(m)-1(a)(1) for a U.S. taxable year of
CFC1, CFC1 has three computations with respect to
Country F tax, because there are three foreign payors
for Country F tax purposes whose foreign income
tax amount, if any, is considered paid or accrued by
CFC1 as the section 901(m) payor. Furthermore, for
each U.S. taxable year, CFC1 will compute a sepa-
rate disqualified tax amount and aggregate basis dif-
ference carryover (if any) under paragraph (b)(2) of
this section, with respect to each foreign payor.
(3) In determining aggregate basis difference for
a U.S. taxable year of CFC2 under §1.901(m)-1(a)
(1), CFC2 has a single computation with respect to
Country F tax, because there is a single foreign payor
(CFC2) for Country F tax purposes whose foreign
income tax amount, if any, is considered paid or ac-
crued by CFC2 as the section 901(m) payor. Further-
more, for each U.S. taxable year, CFC2 will com-
pute a disqualified tax amount and aggregate basis
difference carryover (if any) under paragraph (b)(2)
of this section.
(C) Alternative facts. Assume the same facts as
in paragraph (b)(3)(i)(A) of this section (paragraph
(A) of this Example 1), except that foreign income
for Country F tax purposes is based on combined
income (within the meaning of §1.901-2(f)(3)(ii))
of CFC1, CFC2, DE1, and DE2. For purposes of
determining an aggregate basis difference for a
U.S. taxable year of CFC1 under §1.901(m)-1(a)
(1), CFC1, DE1, and DE2 are treated as a single
foreign payor because all of the items of income,
deduction, gain, or loss with respect to CFC1, DE1,
and DE2 are included in the earnings and profits of
CFC1 for U.S. income tax purposes. For each U.S.
taxable year, CFC1 will therefore compute a single
aggregate basis difference, disqualified tax amount,
and aggregate basis difference carryover. The result
for CFC2 under the alternative facts is the same as
in paragraph (b)(3)(i)(B)(3) (paragraph (B)(3) of
this Example 1).
(ii) Example 2: Computation of disqualified tax
amount—(A) Facts. On December 31 of Year 0, USP
acquires all of the stock of CFC1 in a qualified stock
purchase (as defined in section 338(d)(3)) to which
section 338(a) applies (Acquisition). CFC1 owns
four assets (Asset A, Asset B, Asset C, and Asset D,
and collectively, Assets) and conducts activities in
Country F and in a Country G branch. The activities
conducted by CFC1 in Country G are not subject to
tax in Country F. The tax rate is 25% in Country F
and 30% in Country G. For Country F tax purpos-
es, CFC1’s foreign income and foreign income tax
amount for each foreign taxable year 1 through 15
is 100u and $25 (25u translated at the exchange rate
of $1 = 1u), respectively. For Country G tax purpos-
es, CFC1’s foreign income and foreign income tax
amount for each foreign taxable year 1 through 5 is
400u and $120 (120u translated at the exchange rate
of $1 = 1u), respectively. No dispositions occur for
any of the Assets during the applicable cost recovery
period. Additional facts relevant to each of the Assets
are summarized below.
AssetsRelevant foreign income taxBasis DifferenceApplicable Cost Recovery PeriodCost Recovery Amount
Asset ACountry F tax 150u15 years10u (150u / 15)
Asset BCountry F tax 50u 5 years10u (50u / 5)
Asset CCountry G tax 300u 5 years60u (300u / 5)
Asset DCountry G tax(100u) 5 yearsnegative 20u (negative 100 / 5)
(B) Result. (1) Under §1.901(m)-2(b)(1), the ac-
quisition of the stock of CFC1 is a section 338 CAA.
Under §1.901(m)-2(c)(1), Assets A and B are RFAs
with respect to Country F tax, because they are rel-
evant in determining foreign income of CFC1 for
Country F tax purposes and were owned by CFC1
when the Acquisition occurred. Assets C and D are
RFAs with respect to Country G tax, because they are
relevant in determining foreign income of CFC1 for
Country G tax purposes and were owned by CFC1
when the Acquisition occurred. Under §1.901(m)-1(a)
(37), CFC1 is the RFA owner (U.S.) with respect to
all of the RFAs. Under §1.901(m)-1(a)(41) and (28),
CFC1 is the section 901(m) payor and the foreign pay-
or for Country F and Country G tax purposes.

April 6, 2020 576 Bulletin No. 2020–15
(2) In determining aggregate basis difference for
a U.S. taxable year of CFC1, CFC1 has two compu-
tations, one with respect to Country F tax and one
with respect to Country G tax. Under §1.901(m)-1(a)
(1), the aggregate basis difference for a U.S. taxable
year with respect to Country F tax is equal to the sum
of the allocated basis differences and allocated basis
difference adjustments with respect to Assets A and
B for the U.S. taxable year. Under §1.901(m)-1(a)
(5), allocated basis differences are the sum of cost
recovery amounts and disposition amounts. Because
there are no dispositions, the only allocated basis
differences taken into account in determining an ag-
gregate basis difference are cost recovery amounts.
Under §1.901(m)-5(b), any cost recovery amounts
are attributed to CFC1, because CFC1 is the section
901(m) payor and RFA owner (U.S.) with respect to
all of the Assets. For each U.S. taxable year, CFC1
will compute a separate disqualified tax amount and
aggregate basis difference carryover (if any) with
respect to Country F tax and Country G tax under
paragraph (b)(2) of this section. For purposes of
both disqualified tax amount computations, because
CFC1 is the section 901(m) payor and foreign payor,
the foreign income tax amount paid or accrued by
CFC1 with respect to Country F tax and Country G
tax, respectively, will be the entire foreign income
tax amount and CFC1’s allocable foreign income
will be the entire foreign income.
(3) With respect to Country F tax, in U.S. tax-
able years 1 through 5, CFC1 has an aggregate ba-
sis difference of 20u each year (10u cost recovery
amount with respect to Asset A plus 10u cost recov-
ery amount with respect to Asset B). For U.S. tax-
able years 1 through 5, under paragraph (b)(2) of this
section, the disqualified tax amount each year is $5,
the lesser of two amounts: the tentative disqualified
tax amount, in this case, $5 ($25 foreign income tax
amount x (20u aggregate basis difference / 100u al-
locable foreign income)), or the foreign income tax
amount paid or accrued by CFC1, in this case, $25.
After U.S. taxable year 5, Asset B has no unallocated
basis difference with respect to Country F tax. Ac-
cordingly, in U.S. taxable years 6 through 15, CFC1
has an aggregate basis difference of 10u each year.
Accordingly, for U.S. taxable years 6 through 15,
the disqualified tax amount each year is $2.50, the
lesser of two amounts: the tentative disqualified tax
amount, in this case, $2.50 ($25 foreign income tax
amount x (10u aggregate basis difference / 100u al-
locable foreign income)), or the foreign income tax
amount paid or accrued by CFC1, in this case, $25.
After U.S. taxable year 15, Asset A has no unallocat-
ed basis difference with respect to Country F tax and,
therefore, CFC1 has no disqualified tax amount with
respect to Country F Tax.
(4) With respect to Country G tax, in U.S. taxable
years 1 through 5, CFC1 has an aggregate basis dif-
ference of 40u each year (60u cost recovery amount
with respect to Asset C + (20u) cost recovery amount
with respect to Asset D). For U.S. taxable years 1
through 5, under paragraph (b)(2) of this section, the
disqualified tax amount each year is $12, the lesser of
two amounts: the tentative disqualified tax amount,
in this case, $12 ($120 foreign income tax amount
x (40u aggregate basis difference / 400u allocable
foreign income)), or the foreign income tax amount
paid or accrued by CFC1, in this case, $120. After
U.S. taxable year 5, Asset C and Asset D have no un-
allocated basis difference with respect to Country G
tax. Accordingly, in U.S. taxable years 6 through 15,
CFC1 has no disqualified tax amount with respect to
Country G Tax.
(iii) Example 3: FCCT—(A) Facts. In U.S.
taxable year 1, USP acquires all of the interests in
DE1 in a transaction (Transaction) that is treated
as a stock acquisition for Country F tax purposes.
Immediately after the Transaction, DE1 owns as-
sets (Pre-Transaction Assets), all of which are used
in a Country G branch and give rise to income that
is taken into account for Country F tax and Country
G tax purposes. After the Transaction, DE1 acquires
additional assets (Post-Transaction Assets), which
are not used by the Country G branch. Both Country
F and Country G have a tax rate of 30%. Country F
imposes worldwide tax on its residents and provides
a foreign tax credit for taxes paid to other jurisdic-
tions. In foreign taxable year 3, 100u of income is
attributable to DE1’s Post-Transaction Assets and
100u of income is attributable to DE1’s Pre-Trans-
action Assets. For Country G tax purposes, the for-
eign income is 100u and foreign income tax amount
is 30u (30% x 100u). For Country F tax purposes,
the foreign income is 200u and the pre-foreign tax
credit tax is 60u (30% x 200u). The 60u of Country
F pre-foreign tax credit tax is reduced by the 30u for-
eign income tax amount imposed for Country G tax
purposes. Thus, the foreign income tax amount for
Country F tax purposes is $30 (30u translated into
dollars at the exchange rate of $1 = 1u). Assume that
for U.S. taxable year 3 USP has 100u aggregate basis
difference with respect to Country F tax and 100u
aggregate basis difference with respect to Country G
tax. USP does not dispose of DE1 or any assets of
DE1 in U.S. taxable year 3.
(B) Result. (1) Under §1.901(m)-2(b)(2), the
Transaction is a CAA. Under §1.901(m)-2(c)(1), the
Pre-Transaction Assets are RFAs with respect to both
Country F tax and Country G tax, because they are
relevant in determining the foreign income of DE1
for Country F tax and Country G tax purposes and
were owned by DE1 when the Transaction occurred.
Under §1.901(m)-1(a)(37), USP is the RFA owner
(U.S.) with respect to the RFAs. Under §1.901(m)-
1(a)(28), DE1 is a foreign payor for Country F tax
and Country G tax purposes. Under §1.901(m)-1(a)
(41), USP is the section 901(m) payor with respect
to foreign income tax amounts for which DE1 is the
foreign payor (see §1.901-2(f)(4)(ii)). Because the
Country G foreign income tax amount is claimed as
a credit for purposes of determining the Country F
foreign income tax amount, the Country G foreign
income tax amount is an FCCT under §1.901(m)-
1(a)(22).
(2) Under §1.901(m)-1(a)(1), for each U.S. tax-
able year, USP will separately compute the aggre-
gate basis difference with respect to Country F tax
and with respect to Country G tax and will use those
amounts to separately compute a disqualified tax
amount and aggregate basis difference carryover (if
any) with respect to each foreign income tax. Be-
cause DE1 is a disregarded entity owned by USP
during the entire U.S. taxable year 3, the foreign in-
come tax amount paid or accrued by DE1 is not sub-
ject to allocation. Accordingly, for purposes of each
of the disqualified tax amount computations, the for-
eign income tax amount paid or accrued by USP with
respect to Country F tax and Country G tax, respec-
tively, is the entire foreign income tax amount paid
or accrued by DE1, and, under paragraph (b)(2)(iii)
(A) of this section, USP’s allocable foreign income
will be equal to DE1’s entire foreign income.
(3) As stated in paragraph (b)(3)(iii)(A) of this
section (paragraph (A) of this Example 3), for U.S.
taxable year 3 USP has 100u aggregate basis differ-
ence with respect to Country F tax and 100u aggre-
gate basis difference with respect to Country G tax.
With respect to Country G tax, in U.S. taxable year 3,
under paragraph (b)(2) of this section, the disquali-
fied tax amount is $30, the lesser of the two amounts:
the tentative disqualified tax amount, in this case,
$30 ($30 foreign income tax amount x (100u ag-
gregate basis difference / 100u allocable foreign in-
come)), or the foreign income tax amount considered
paid or accrued by USP, in this case, $30.
(4) With respect to Country F tax, in U.S. taxable
year 3, under paragraph (b)(2) of this section, the dis-
qualified tax amount is $0, the lesser of two amounts:
the tentative disqualified tax amount, in this case $0
(($30 foreign income tax amount + $30 Country G
FCCT) x (100u aggregate basis difference / 200u
foreign income) = $30 reduced by $30 Country G
FCCT that is a disqualified tax amount of USP), or
the foreign income tax amount considered paid or
accrued by USP, in this case, $30.
(c) Aggregate basis difference carryover—(1) In
general. If a section 901(m) payor has an aggregate
basis difference carryover for a U.S. taxable year, as
determined under this paragraph (c), the aggregate
basis difference carryover is taken into account in
computing the section 901(m) payor’s aggregate
basis difference for the next U.S. taxable year. For
successor rules that apply to an aggregate basis dif-
ference carryover, see §1.901(m)-6(c).
(2) Amount of aggregate basis differ-
ence carryover. (i) If a section 901(m)
payor’s disqualified tax amount is zero, all
of the section 901(m) payor’s aggregate
basis difference (positive or negative) for
the U.S. taxable year gives rise to an ag-
gregate basis difference carryover to the
next U.S. taxable year.
(ii) If a section 901(m) payor’s disqual-
ified tax amount is not zero, then aggre-
gate basis difference carryover can arise
in either or both of the following two sit-
uations:
(A) If a section 901(m) payor’s aggre-
gate basis difference for the U.S. taxable
year exceeds its allocable foreign income,
the excess gives rise to an aggregate basis
difference carryover.
(B) If the tentative disqualified tax
amount exceeds the disqualified tax
amount, the excess tentative disqualified
tax amount is converted into aggregate
basis difference carryover by multiplying
such excess by a fraction, the numerator
of which is the allocable foreign income,

Bulletin No. 2020–15 577 April 6, 2020
and the denominator of which is the sum
of the foreign income tax amount and
the FCCTs that are paid or accrued by, or
considered paid or accrued by, the section
901(m) payor.
(3) Example. The following example
illustrates the rules of paragraph (c) of this
section.
(i) Facts. (A) On July 1 of Year 1, CFC1 ac-
quires all of the interests of DE1 in a transaction
(Transaction) that is treated as a stock acquisition for
Country F tax purposes. CFC1 and DE1 are orga-
nized in Country F and are treated as corporations
for Country F tax purposes. CFC1 is an applicable
foreign corporation, and DE1 is a disregarded entity.
CFC1 has a calendar year for U.S. income tax pur-
poses, and DE1 has a June 30 year-end for Country
F tax purposes. Country F imposes a single tax that
is a foreign income tax. CFC1 and DE1 each have a
functional currency of the u with respect to all activ-
ities. Immediately after the Transaction, DE1 owns
one asset, Asset A, that gives rise to income that is
taken into account for Country F tax purposes. For
the first U.S. taxable year (U.S. taxable year 1) there
is a cost recovery amount with respect to Asset A of
9u, and for each subsequent U.S. taxable year until
the U.S. basis is fully recovered, there is a cost re-
covery amount with respect to Asset A of 18u. There
is no disposition of Asset A.
(ii) Result. (A) Under §1.901(m)-2(b)(2), the
Transaction is a CAA. Under §1.901(m)-2(c)(1),
Asset A is an RFA with respect to Country F tax
because it is relevant in determining the foreign in-
come of DE1 for Country F tax purposes and was
owned by DE1 when the Transaction occurred. Un-
der §1.901(m)-1(a)(37), CFC1 is the RFA owner
(U.S.) with respect to Asset A. Under §1.901(m)-
1(a)(28), DE1 is a foreign payor for Country F tax
purposes. Under §1.901(m)-1(a)(41), CFC1 is the
section 901(m) payor with respect to foreign income
tax amounts for which DE1 is the foreign payor (see
§1.901-2(f)(4)(ii)).
(B) Under §1.901(m)-1(a)(1), in determining the
aggregate basis difference for U.S. taxable year 1,
CFC1 has one computation with respect to Country F
tax. Under §1.901(m)-1(a)(1), aggregate basis differ-
ence with respect to Country F tax is equal to the sum
of allocated basis differences and allocated basis dif-
ference adjustments with respect to all RFAs, which,
in this case, is only Asset A. Under §1.901(m)-1(a)
(5), allocated basis differences are the sum of cost
recovery amounts and disposition amounts. Because
there is no disposition of Asset A, the only allocated
basis difference taken into account in determining an
aggregate basis difference are cost recovery amounts
with respect to Asset A. Under §1.901(m)-5(b), any
cost recovery amounts are assigned to a U.S taxable
year of CFC1, because CFC1 is the section 901(m)
payor and RFA owner (U.S.) with respect to Asset
A. Under paragraph (b)(2) of this section, for each
U.S. taxable year, CFC1 will compute a disqualified
tax amount and aggregate basis difference carryover
with respect to the aggregate basis difference. Be-
cause DE1 is a disregarded entity owned by CFC1,
the foreign income tax amount paid or accrued by
DE1 is not subject to allocation. Accordingly, for
purposes of the disqualified tax amount computa-
tion, the foreign income tax amount paid or accrued
by CFC1 with respect to Country F tax is the entire
foreign income tax amount paid or accrued by DE1,
and under paragraph (b)(2)(iii)(A) of this section,
CFC1’s allocable foreign income will be equal to
DE1’s entire foreign income.
(C) In U.S. taxable year 1, CFC1 has an aggre-
gate basis difference of 9u (the 9u cost recovery
amount with respect to Asset A for U.S. taxable year
1). However, because the foreign taxable year of
DE1, the foreign payor, will not end between July 1
and December 31, there will not be a foreign income
tax amount for U.S. taxable year 1. Because the for-
eign income tax amount considered paid or accrued
by CFC1 for U.S. taxable year 1 is zero, under para-
graph (b)(2)(iv) of this section, the disqualified tax
amount for U.S. taxable year 1 of CFC1 is also zero.
Furthermore, because the disqualified tax amount is
zero, under paragraph (c)(2)(i) of this section, CFC1
has an aggregate basis difference carryover equal to
9u, the entire amount of the aggregate basis differ-
ence for U.S. taxable year 1. Under paragraph (c)
(1) of this section, the 9u aggregate basis difference
carryover is taken into account in computing CFC1’s
aggregate basis difference for U.S. taxable year 2.
Accordingly, in U.S. taxable year 2, CFC1 has an
aggregate basis difference of 27u (18u cost recovery
amount for U.S. taxable year 2, plus 9u aggregate
basis difference carryover from U.S. taxable year 1).
(d) Applicability dates. This section
applies to CAAs occurring on or after
March 20, 2020. Taxpayers may, how-
ever, choose to apply this section before
the date this section is applicable provid-
ed that they (along with any persons that
are related (within the meaning of section
267(b) or 707(b)) to the taxpayer)—
(1) Consistently apply this section,
§1.704-1(b)(4)(viii)(c)(4)(v) through (vii),
§1.901(m)-1, and §§1.901(m)-4 through
1.901(m)-8 (excluding §1.901(m)-4(e)) to
all CAAs occurring on or after January 1,
2011, and consistently apply §1.901(m)-2
(excluding §1.901(m)-2(d)) to all CAAs
occurring on or after December 7, 2016,
on any original or amended tax return for
each taxable year for which the applica-
tion of the provisions listed in this para-
graph (d)(1) affects the tax liability and
for which the statute of limitations does
not preclude assessment or the filing of a
claim for refund, as applicable
(2) File all tax returns described in para-
graph (d)(1) of this section for any taxable
year ending on or before March 23, 2020,
no later than March 23, 2021; and
(3) Make appropriate adjustments to
take into account deficiencies that would
have resulted from the consistent applica-
tion under paragraph (d)(1) of this section
for taxable years that are not open for as-
sessment.
§1.901(m)-3T [Removed]
Par. 8. Section 1.901(m)-3T is re-
moved.
Par. 9. Section 1.901(m)-4 is added to
read as follows:
§1.901(m)-4 Determination of basis
difference.
(a) In general. This section provides
rules for determining for each RFA the
basis difference that arises as a result of
a CAA. A basis difference is computed
separately with respect to each foreign
income tax for which an asset subject to
a CAA is an RFA. Paragraph (b) of this
section provides the general rule for de-
termining basis difference that references
only U.S. basis in the RFA. Paragraph (c)
of this section provides for an election to
determine basis difference by reference to
foreign basis and sets forth the procedures
for making the election. Paragraph (d) of
this section provides special rules for de-
termining basis difference in the case of a
section 743(b) CAA. Paragraph (e) of this
section provides a special rule for deter-
mining basis difference in an RFA with
respect to a CAA to which paragraphs (b)
through (d) of this section do not apply.
Paragraph (f) of this section provides ex-
amples illustrating the rules of this sec-
tion, and paragraph (g) of this section pro-
vides applicability dates.
(b) General rule. Except as otherwise
provided in paragraphs (c), (d), and (e) of
this section, basis difference is the U.S. ba-
sis in the RFA immediately after the CAA,
less the U.S. basis in the RFA immediately
before the CAA. Basis difference is an at-
tribute that attaches to an RFA.
(c) Foreign basis election. (1) An elec-
tion (foreign basis election) may be made
to apply section 901(m)(3)(C)(i)(II) by
reference to the foreign basis immediate-
ly after the CAA instead of the U.S. basis
immediately before the CAA. According-
ly, if a foreign basis election is made, basis
difference is the U.S. basis in the RFA im-
mediately after the CAA, less the foreign
basis in the RFA immediately after the
CAA. For this purpose, the foreign basis
immediately after the CAA takes into ac-
count any adjustment to that foreign basis
resulting from the CAA for purposes of
the foreign income tax.

April 6, 2020 578 Bulletin No. 2020–15
(2) Except as otherwise provided in
this paragraph (c), a foreign basis election
is made by the RFA owner (U.S.). If, how-
ever, the RFA owner (U.S.) is a partner-
ship, each partner in the partnership (and
not the partnership) may independently
make a foreign basis election. In the case
of one or more tiered partnerships, the for-
eign basis election is made at the level at
which a partner is not also a partnership.
(3) The foreign basis election may be
made separately for each CAA, and with
respect to each foreign income tax and
each foreign payor. For purposes of mak-
ing the foreign basis election, all CAAs
that are part of an aggregated CAA trans-
action are treated as a single CAA. Fur-
thermore, for purposes of making the for-
eign basis election, if foreign law imposes
tax on the combined income (within the
meaning of §1.901-2(f)(3)(ii)) of two or
more foreign payors, all foreign payors
whose items of income, deduction, gain,
or loss for U.S. income tax purposes are
included in the U.S. taxable income or
earnings and profits of a single section
901(m) payor are treated as a single for-
eign payor.
(4) A foreign basis election is made
by using foreign basis to determine basis
difference for purposes of computing a
disqualified tax amount and an aggregate
basis difference carryover for the U.S. tax-
able year, as provided under §1.901(m)-3.
A separate statement or form evidencing
the foreign basis election need not be
filed. Except as provided in paragraphs (c)
(5) and (6) of this section, in order for a
foreign basis election to be effective, the
election must be reflected on a timely filed
original federal income tax return (taking
into account extensions) for the first U.S.
taxable year that the foreign basis elec-
tion is relevant to the computation of any
amounts reported on such return, includ-
ing on any required schedules.
(5) If the RFA owner (U.S.) is a part-
nership, a foreign basis election reflected
on a partner’s timely filed amended feder-
al income tax return is also effective if all
of the following conditions are satisfied:
(i) The partner’s timely filed original
federal income tax return (taking into ac-
count extensions) for the first U.S. taxable
year of the partner in which a foreign ba-
sis election is relevant to the computation
of any amounts reported on such return,
including on any required schedules,
does not reflect the application of section
901(m);
(ii) The information provided by the
partnership to the partner for purposes of
applying section 901(m) and any informa-
tion required to be reported by the part-
nership is based solely on computations
that use foreign basis to determine basis
difference; and
(iii) Before the due date of the origi-
nal federal income tax return described
in paragraph (c)(5)(i) of this section, the
partner delegated the authority to the part-
nership to choose whether to provide the
partner with information to apply section
901(m) using foreign basis, either pur-
suant to a written partnership agreement
(within the meaning of §1.704-1(b)(2)(ii)
(h)) or written notice provided by the part-
ner to the partnership.
(6) If, pursuant to paragraph (g)(3) of
this section, a taxpayer chooses to have
this section apply to CAAs occurring on
or after January 1, 2011, a foreign basis
election will be effective if the election is
reflected on a timely filed amended fed-
eral income tax return (or tax returns, as
applicable) filed no later than March 23,
2021.
(7) The foreign basis election is irre-
vocable. Relief under §301.9100-1 is not
available for the foreign basis election.
(d) Determination of basis difference
in a section 743(b) CAA—(1) In general.
Except as provided in paragraphs (d)(2)
and (e) of this section, if there is a section
743(b) CAA, basis difference is the result-
ing basis adjustment under section 743(b)
that is allocated to the RFA under section
755.
(2) Foreign basis election. If a foreign
basis election is made with respect to a
section 743(b) CAA, then, for purposes of
paragraph (d)(1) of this section, the sec-
tion 743(b) adjustment is determined by
reference to the foreign basis of the RFA,
determined immediately after the CAA.
(e) Determination of basis difference in
an RFA with respect to a CAA with respect
to which paragraphs (b), (c), and (d) of
this section do not apply. For CAAs oc-
curring on or after January 1, 2011, and
before July 21, 2014, other than CAAs
occurring before July 21, 2014, resulting
from an entity classification election made
under §301.7701-3 of this chapter that is
filed on or after July 29, 2014, and that is
effective on or before July 21, 2014, basis
difference in an RFA with respect to the
CAA is the amount of any basis difference
(within the meaning of section 901(m)(3)
(C)(i)) that had not been taken into ac-
count under section 901(m)(3)(B) either
as of July 21, 2014, or, in the case of an
entity classification election made under
§301.7701-3 of this chapter that is filed
on or after July 29, 2014, and that is ef-
fective on or before July 21, 2014, before
the transactions that are deemed to occur
under §301.7701-3(g) as a result of the
change in classification.
(f) Examples. The following examples
illustrate the rules of this section:
(1) Example 1: Scope of basis choice; identifying
separate CAAs, RFA owners (U.S.), and foreign pay-
ors in an aggregated CAA transaction—(i) Facts.
CFC1 wholly owns CFC2, both of which are appli-
cable foreign corporations, organized in Country F,
and treated as corporations for Country F tax purpos-
es. CFC1 also wholly owns DE1, and DE1 wholly
owns DE2. DE1 and DE2 are entities organized in
Country F treated as corporations for Country F tax
purposes and as disregarded entities for U.S. income
tax purposes. Country F imposes a single tax that
is a foreign income tax. All of the stock of CFC1
is acquired in a qualified stock purchase (within
the meaning of section 338(d)(3)) to which section
338(a) applies for both CFC1 and CFC2. For Coun-
try F tax purposes, the transaction is treated as an
acquisition of the stock of CFC1.
(ii) Result. (A) The acquisition of CFC1 gives
rise to four separate CAAs described in §1.901(m)-
2. Under §1.901(m)-2(b)(1), the acquisition of the
stock of CFC1 and the deemed acquisition of the
stock of CFC2 under section 338(h)(3)(B) are each a
section 338 CAA. Furthermore, because the deemed
acquisition of the assets of each of DE1 and DE2 for
U.S. income tax purposes is disregarded for Country
F tax purposes, the deemed acquisitions are CAAs
under §1.901(m)-2(b)(2). Because the four CAAs
occurred pursuant to a plan, under §1.901(m)-1(a)
(3), all of the CAAs are part of an aggregated CAA
transaction. Under §1.901(m)-1(a)(37), CFC1 is the
RFA owner (U.S.) with respect to its assets and the
assets of DE1 and DE2 that are RFAs. CFC2 is the
RFA owner (U.S.) with respect to its assets that are
RFAs. Under §1.901(m)-1(a)(28), CFC1, CFC2,
DE1, and DE2 are each a foreign payor for Country
F tax purposes.
(B) Under paragraph (c) of this section, a for-
eign basis election may be made by the RFA owner
(U.S.). The election is made separately with respect
to each CAA (for this purpose, treating all CAAs that
are part of an aggregated CAA transaction as a sin-
gle CAA) and with respect to each foreign income
tax and foreign payor. Thus, in this case, CFC1 can
make a separate foreign basis election for one or
more of the following three groups of RFAs: RFAs
that are relevant in determining foreign income of
CFC1; RFAs that are relevant in determining foreign
income of DE1; and RFAs that are relevant in deter-

Bulletin No. 2020–15 579 April 6, 2020
mining foreign income of DE2. Furthermore, CFC2
can make a foreign basis election for all of its RFAs
that are relevant in determining its foreign income.
(2) Example 2: Scope of basis choice; RFA owner
(U.S.) is a partnership—(i) Facts. USPS is a domes-
tic partnership for which a section 754 election is in
effect. USPS owns two assets, the stock of DE1 and
DE2. DE1 is an entity organized in Country X and
treated as a corporation for Country X tax purposes.
DE2 is an entity organized in Country Y and treated
as a corporation for Country Y tax purposes. DE1
and DE2 are disregarded entities. Country X and
Country Y each impose a single tax that is a foreign
income tax. US1 and US2, unrelated domestic cor-
porations, and FP, a foreign person unrelated to US1
and US2, acquire partnership interests in USPS from
existing partners of USPS pursuant to the same plan.
(ii) Result. Under §1.901(m)-2(b)(3), the acqui-
sitions of the partnership interests in USPS by US1,
US2, and FP each give rise to separate section 743(b)
CAAs, but under §1.901(m)-1(a)(3), they are treated
as an aggregated CAA transaction because they occur
as part of a plan. Under §1.901(m)-1(a)(37), USPS
is the RFA owner (U.S.) with respect to the assets
of DE1 and DE2 that are RFAs. Under §1.901(m)-
1(a)(28), DE1 is a foreign payor for Country X tax
purposes, and DE2 is a foreign payor for Country
Y tax purposes. Because the RFA owner (U.S.) is
a partnership, paragraph (c)(2) of this section pro-
vides that US1, US2, and FP (the relevant partners
in USPS) separately choose whether to make a for-
eign basis election for purposes of determining basis
difference. Furthermore, under paragraph (c)(3) of
this section, the choice to make the election is made
separately by each partner with respect to each for-
eign payor. Thus, in this case, each partner may make
separate elections for the RFAs that are relevant in
determining foreign income of DE1 for Country X
tax purposes and the RFAs that are relevant in de-
termining foreign income of DE2 for Country Y tax
purposes.
(g) Applicability dates. (1) Except as
provided in paragraph (g)(2) of this sec-
tion, this section applies to CAAs occur-
ring on or after March 23, 2020.
(2) Paragraphs (a), (b), and (d)(1) of
this section apply to CAAs occurring on
or after July 21, 2014, and to CAAs oc-
curring before that date resulting from an
entity classification election made under
§301.7701-3 that is filed on or after July
29, 2014, and that is effective on or before
July 21, 2014. Paragraph (e) of this sec-
tion applies to CAAs occurring on or after
January 1, 2011, and before July 21, 2014,
other than CAAs occurring before July 21,
2014, resulting from an entity classifica-
tion election made under §301.7701-3 of
this chapter that is filed on or after July
29, 2014, and that is effective on or before
July 21, 2014. Taxpayers may, however,
consistently apply paragraph (d)(1) of this
section to all section 743(b) CAAs occur-
ring on or after January 1, 2011. For this
purpose, persons that are related (within
the meaning of section 267(b) or 707(b))
will be treated as a single taxpayer.
(3) Taxpayers may, however, choose
to apply provisions in this section before
the date such provisions are applicable
pursuant to paragraph (g)(1) or (2) of this
section, provided that they (along with
any persons that are related (within the
meaning of section 267(b) or 707(b)) to
the taxpayer)—
(i) Consistently apply this section (ex-
cluding paragraph (e) of this section),
§1.704-1(b)(4)(viii)(c)(4)(v) through
(vii), §1.901(m)-1, §1.901(m)-3, and
§§1.901(m)-5 through 1.901(m)-8 to all
CAAs occurring on or after January 1,
2011, and consistently apply §1.901(m)-2
(excluding §1.901(m)-2(d)) to all CAAs
occurring on or after December 7, 2016,
on any original or amended tax return for
each taxable year for which the applica-
tion of the provisions listed in this para-
graph (g)(3)(i) affects the tax liability and
for which the statute of limitations does
not preclude assessment or the filing of a
claim for refund, as applicable;
(ii) File all tax returns described in
paragraph (g)(3)(i) of this section for any
taxable year ending on or before March
23, 2020, no later than March 23, 2021;
and
(iii) Make appropriate adjustments to
take into account deficiencies that would
have resulted from the consistent applica-
tion under paragraph (g)(3)(i) of this sec-
tion for taxable years that are not open for
assessment.
§1.901(m)-4T [Removed]
Par. 10. Section 1.901(m)-4T is re-
moved.
Par. 11. Section 1.901(m)-5 is added to
read as follows:
§1.901(m)-5 Basis difference taken into
account.
(a) In general. This section provides
rules for determining the amount of ba-
sis difference with respect to an RFA
that is taken into account in a U.S. tax-
able year for purposes of determining the
disqualified portion of a foreign income
tax amount. Paragraph (b) of this section
provides rules for determining a cost re-
covery amount and assigning that amount
to a U.S. taxable year of a single section
901(m) payor when the RFA owner (U.S.)
is the section 901(m) payor. Paragraph (c)
of this section provides rules for determin-
ing a disposition amount and assigning
that amount to a U.S. taxable year of a sin-
gle section 901(m) payor when the RFA
owner (U.S.) is the section 901(m) payor.
Paragraph (d) of this section provides rules
for allocating cost recovery amounts and
disposition amounts when the RFA owner
(U.S.) is a fiscally transparent entity for
U.S. income tax purposes. Paragraph (e)
of this section provides special rules for
allocating cost recovery amounts and dis-
position amounts with respect to certain
section 743(b) CAAs. Paragraph (f) of
this section provides special rules for allo-
cating certain disposition amounts when a
foreign payor is transferred in a mid-year
transaction. Paragraph (g) of this section
provides special rules for allocating both
cost recovery amounts and disposition
amounts in certain cases in which the RFA
owner (U.S.) either is a reverse hybrid or
a fiscally transparent entity for both U.S.
and foreign income tax purposes that is
directly or indirectly owned by a reverse
hybrid. Paragraph (h) of this section pro-
vides examples illustrating the application
of this section. Paragraph (i) of this sec-
tion provides the applicability dates.
(b) Basis difference taken into account
under applicable cost recovery meth-
od—(1) In general. When the RFA owner
(U.S.) is a section 901(m) payor, all of a
cost recovery amount is attributed to the
section 901(m) payor and assigned to the
U.S. taxable year of the section 901(m)
payor in which the corresponding U.S.
basis deduction is taken into account un-
der the applicable cost recovery method.
This is the case regardless of whether the
deduction is deferred or disallowed for
U.S. income tax purposes. If instead the
RFA owner (U.S.) is a fiscally transpar-
ent entity for U.S. income tax purposes,
a cost recovery amount is allocated to
one or more section 901(m) payors un-
der paragraph (d) of this section, except
as provided in paragraphs (e) and (g) of
this section. If a cost recovery amount
arises from an RFA with respect to a sec-
tion 743(b) CAA, in certain cases the cost
recovery amount is allocated to a section
901(m) payor under paragraph (e) of this

April 6, 2020 580 Bulletin No. 2020–15
section. In certain cases in which the RFA
owner (U.S.) either is a reverse hybrid or
a fiscally transparent entity for both U.S.
and foreign income tax purposes that is
directly or indirectly owned by a reverse
hybrid, a cost recovery amount is allocat-
ed to one or more section 901(m) payors
under paragraph (g) of this section.
(2) Determining a cost recovery
amount—(i) General rule. A cost recov-
ery amount for an RFA is determined by
applying the applicable cost recovery
method to the basis difference rather than
to the U.S. basis.
(ii) U.S. basis subject to multiple cost
recovery methods. If the entire U.S. ba-
sis is not subject to the same cost recov-
ery method, the applicable cost recovery
method for determining the cost recovery
amount is the cost recovery method that
applies to the portion of the U.S. basis that
corresponds to the basis difference.
(3) Applicable cost recovery method.
For purposes of section 901(m), an appli-
cable cost recovery method includes any
method for recovering the cost of property
over time for U.S. income tax purposes
(each application of a method giving rise
to a U.S. basis deduction). Such methods
include depreciation, amortization, or de-
pletion, as well as a method that allows the
cost (or a portion of the cost) of property
to be expensed in the year of acquisition
or in the placed-in-service year, such as
under section 179. Applicable cost recov-
ery methods do not include any provision
allowing the U.S. basis to be recovered
upon a disposition of an RFA.
(c) Basis difference taken into account
as a result of a disposition—(1) In gener-
al. Except as provided in paragraph (f) of
this section, when the RFA owner (U.S.) is
a section 901(m) payor, all of a disposition
amount is attributed to the section 901(m)
payor and assigned to the U.S. taxable year
of the section 901(m) payor in which the
disposition occurs. If instead the RFA own-
er (U.S.) is a fiscally transparent entity for
U.S. income tax purposes, except as pro-
vided in paragraphs (e), (f), and (g) of this
section, a disposition amount is allocated to
one or more section 901(m) payors under
paragraph (d) of this section. If a disposi-
tion amount arises from an RFA with re-
spect to a section 743(b) CAA, in certain
cases the disposition amount is allocated to
a section 901(m) payor under paragraph (e)
of this section. If there is a disposition of
an RFA in a foreign taxable year of a for-
eign payor during which there is a mid-year
transaction, in certain cases a disposition
amount is allocated under paragraph (f) of
this section. In certain cases in which the
RFA owner (U.S.) either is a reverse hy-
brid or a fiscally transparent entity for both
U.S. and foreign income tax purposes that
is directly or indirectly owned by a reverse
hybrid, a disposition amount is allocated to
one or more section 901(m) payors under
paragraph (g) of this section.
(2) Determining a disposition
amount—(i) Disposition is fully taxable
for purposes of both U.S. income tax and
the foreign income tax. If a disposition of
an RFA is fully taxable (that is, results in
all gain or loss, if any, being recognized
with respect to the RFA) for purposes of
both U.S. income tax and the foreign in-
come tax, the disposition amount is equal
to the unallocated basis difference with
respect to the RFA.
(ii) Disposition is not fully taxable for
purposes of U.S. income tax or the foreign
income tax (or both). If the disposition of
an RFA is not fully taxable for purposes
of both U.S. income tax and the foreign
income tax, the disposition amount is de-
termined under this paragraph (c)(2)(ii).
See §1.901(m)-6 for rules regarding the
continued application of section 901(m)
if the RFA has any unallocated basis dif-
ference after determining the disposition
amount under paragraph (c)(2)(ii)(A) or
(B) of this section, as applicable.
(A) Positive basis difference. If the
disposition of an RFA is not fully taxable
for purposes of both U.S. income tax and
the foreign income tax, and the RFA has
a positive basis difference, the disposition
amount equals the lesser of:
(1) Any foreign disposition gain plus
any U.S. disposition loss (for this purpose,
expressed as a positive amount), or
(2) Unallocated basis difference with
respect to the RFA.
(B) Negative basis difference. If the
disposition of an RFA is not fully taxable
for purposes of both U.S. income tax and
the foreign income tax, and the RFA has a
negative basis difference, the disposition
amount equals the greater of:
(1) Any U.S. disposition gain (for this
purpose, expressed as a negative amount)
plus any foreign disposition loss, or
(2) Unallocated basis difference with
respect to the RFA.
(iii) Disposition of an RFA after a sec-
tion 743(b) CAA. If an RFA was subject
to a section 743(b) CAA and subsequent-
ly there is a disposition of the RFA, then,
for purposes of determining the disposi-
tion amount, foreign disposition gain or
foreign disposition loss are specially de-
fined to mean the amount of gain or loss
recognized for purposes of the foreign
income tax on the disposition of the RFA
that is allocable to the partnership interest
that was transferred in the section 743(b)
CAA. In addition, U.S. disposition gain or
U.S. disposition loss are specially defined
to mean the amount of gain or loss rec-
ognized for U.S. income tax purposes on
the disposition of the RFA that is allocable
to the partnership interest that was trans-
ferred in the section 743(b) CAA, taking
into account the basis adjustment under
section 743(b) that was allocated to the
RFA under section 755.
(d) General rules for allocating and
assigning a cost recovery amount or a
disposition amount when the RFA owner
(U.S.) is a fiscally transparent entity—(1)
In general. Except as provided in para-
graphs (e), (f), and (g) of this section, this
paragraph (d) provides rules for allocating
a cost recovery amount or a disposition
amount when the RFA owner (U.S.) is a
fiscally transparent entity for U.S. income
tax purposes in which a section 901(m)
payor directly or indirectly owns an inter-
est, as well as for assigning the allocated
amount to a U.S. taxable year of the sec-
tion 901(m) payor. For purposes of this
paragraph (d), unless otherwise indicated,
a reference to direct or indirect ownership
in an entity means for U.S. income tax
purposes. For purposes of this paragraph
(d), a person indirectly owns an interest in
an entity for U.S. income tax purposes if
the person owns the interest through one
or more fiscally transparent entities for
U.S. income tax purposes, and at least one
of the fiscally transparent entities is not
a disregarded entity. For purposes of this
paragraph (d), a person indirectly owns an
interest in an entity for foreign income tax
purposes if the person owns the interest
through one or more fiscally transparent
entities for foreign income tax purposes.
If the RFA owner (U.S.) is a lower-tier
fiscally transparent entity for U.S. income

Bulletin No. 2020–15 581 April 6, 2020
tax purposes in which the section 901(m)
payor indirectly owns an interest, the rules
of this section apply in a manner consis-
tent with the application of these rules
when the section 901(m) payor directly
owns an interest in the RFA owner (U.S.).
(2) Allocation of a cost recovery
amount. A cost recovery amount is allocat-
ed to a section 901(m) payor that directly
or indirectly owns an interest in the RFA
owner (U.S.) to the extent the U.S. basis
deduction that corresponds to the cost
recovery amount is (or will be) included
in the section 901(m) payor’s distributive
share of the income of the RFA owner
(U.S.) for U.S. income tax purposes.
(3) Allocation of a disposition amount
attributable to foreign disposition gain or
foreign disposition loss—(i) In general.
Except as provided in paragraph (f) of this
section, a disposition amount attributable
to foreign disposition gain or foreign dis-
position loss (as determined under para-
graph (d)(5) of this section) is allocated
under paragraph (d)(3)(ii) or (d)(3)(iii) of
this section to a section 901(m) payor that
directly or indirectly owns an interest in
the RFA owner (U.S.).
(ii) First allocation rule. This para-
graph (d)(3)(ii) applies when a section
901(m) payor, or a disregarded entity di-
rectly owned by a section 901(m) payor,
is the foreign payor whose foreign income
includes a distributive share of the foreign
income of the RFA owner (foreign) and,
therefore, all of the foreign income tax
amount of the foreign payor is paid or ac-
crued by, or considered paid by, the section
901(m) payor. Thus, this paragraph (d)(3)
(ii) applies when the RFA owner (U.S.) is
a fiscally transparent entity for both U.S.
and foreign income tax purposes and a
section 901(m) payor either directly owns
an interest in the RFA owner (U.S.) or di-
rectly owns an interest in another fiscally
transparent entity for U.S. and foreign in-
come tax purposes, which, in turn, directly
or indirectly owns an interest in the RFA
owner (U.S.) for both U.S. and foreign
income tax purposes. In these cases, the
section 901(m) payor is allocated the por-
tion of a disposition amount that is equal
to the product of the disposition amount
attributable to foreign disposition gain or
foreign disposition loss, as applicable, and
a fraction, the numerator of which is the
portion of the foreign disposition gain or
foreign disposition loss recognized by the
RFA owner (foreign) for foreign income
tax purposes that is (or will be) included
in the foreign payor’s distributive share
of the foreign income of the RFA owner
(foreign), and the denominator of which
is the foreign disposition gain or foreign
disposition loss.
(iii) Second allocation rule. This para-
graph (d)(3)(iii) applies when neither a
section 901(m) payor nor a disregarded
entity directly owned by a section 901(m)
payor is the foreign payor with respect
to the foreign income of the RFA owner
(foreign). Instead, a section 901(m) payor
directly or indirectly owns an interest in
the foreign payor, which is a fiscally trans-
parent entity for U.S. income tax purposes
(other than a disregarded entity directly
owned by the section 901(m) payor), and,
therefore, the section 901(m) payor is con-
sidered to pay or accrue only its allocated
portion of the foreign income tax amount
of the foreign payor. This will be the case
when the foreign payor is either the RFA
owner (U.S.), another fiscally transpar-
ent entity for U.S. income tax purposes
(other than a disregarded entity directly
owned by a section 901(m) payor) that
directly or indirectly owns an interest in
the RFA owner (U.S.) for both U.S. and
foreign income tax purposes, or a disre-
garded entity directly owned by the RFA
owner (U.S.). In these cases, the section
901(m) payor is allocated the portion of
a disposition amount that is equal to the
product of the disposition amount attrib-
utable to foreign disposition gain or for-
eign disposition loss, as applicable, and
a fraction, the numerator of which is the
portion of the foreign disposition gain or
foreign disposition loss that is included in
the allocable foreign income of the sec-
tion 901(m) payor, and the denominator
of which is the foreign disposition gain or
foreign disposition loss. If allocable for-
eign income is not otherwise required to
be determined because there is no foreign
income tax amount, the numerator is the
portion of the foreign disposition gain or
foreign disposition loss that would be in-
cluded in the allocable foreign income of
the section 901(m) payor if there were a
foreign income tax amount.
(4) Allocation of a disposition amount
attributable to U.S. disposition gain or
U.S. disposition loss. A section 901(m)
payor that directly or indirectly owns an
interest in the RFA owner (U.S.) is allo-
cated the portion of a disposition amount
that is equal to the product of the dispo-
sition amount attributable to U.S. dispo-
sition gain or U.S. disposition loss (as
determined under paragraph (d)(5) of this
section), as applicable, and a fraction, the
numerator of which is the portion of the
U.S. disposition gain or U.S. disposition
loss that is (or will be) included in the sec-
tion 901(m) payor’s distributive share of
income of the RFA owner (U.S.) for U.S.
income tax purposes, and the denomina-
tor of which is the U.S. disposition gain or
U.S. disposition loss.
(5) Determining the extent to which
a disposition amount is attributable to
foreign or U.S. disposition gain or loss—
(i) RFA with a positive basis difference.
When there is a disposition of an RFA
with a positive basis difference and the
disposition results in either a foreign dis-
position gain or a U.S. disposition loss,
but not both, the entire disposition amount
is attributable to foreign disposition gain
or U.S. disposition loss, as applicable,
even if the disposition amount exceeds
the foreign disposition gain or the abso-
lute value of the U.S. disposition loss. If
the disposition results in both a foreign
disposition gain and a U.S. disposition
loss, the disposition amount is attribut-
able first to foreign disposition gain to the
extent thereof, and the excess disposition
amount, if any, is attributable to the U.S.
disposition loss, even if the excess dispo-
sition amount exceeds the absolute value
of the U.S. disposition loss.
(ii) RFA with a negative basis differ-
ence. When there is a disposition of an
RFA with a negative basis difference and
the disposition results in either a foreign
disposition loss or a U.S. disposition gain,
but not both, the entire disposition amount
is attributable to foreign disposition loss
or U.S. disposition gain, as applicable,
even if the absolute value of the disposi-
tion amount exceeds the absolute value of
the foreign disposition loss or the U.S. dis-
position gain. If the disposition results in
both a foreign disposition loss and a U.S.
disposition gain, the disposition amount is
attributable first to foreign disposition loss
to the extent thereof, and the excess dispo-
sition amount, if any, is attributable to the
U.S. disposition gain, even if the absolute

April 6, 2020 582 Bulletin No. 2020–15
value of the excess disposition amount ex-
ceeds the U.S. disposition gain.
(6) U.S. taxable year of a section
901(m) payor to which an allocated cost
recovery amount or disposition amount
is assigned. A cost recovery amount or a
disposition amount allocated to a section
901(m) payor under paragraph (d) of this
section is assigned to the U.S. taxable year
of the section 901(m) payor that includes
the last day of the U.S. taxable year of the
RFA owner (U.S.) in which, in the case of
a cost recovery amount, the RFA owner
(U.S.) takes into account the correspond-
ing U.S. basis deduction (without regard
to whether the deduction is deferred or
disallowed for U.S. income tax purposes),
or in the case of a disposition amount, the
disposition occurs.
(e) Special rules for certain section
743(b) CAAs. If a section 901(m) payor
acquires a partnership interest in a section
743(b) CAA, including a section 743(b)
CAA with respect to a lower-tier partner-
ship that results from a direct acquisition
by the section 901(m) payor of an interest
in an upper-tier partnership, and subse-
quently there is a cost recovery amount or
a disposition amount that arises from an
RFA with respect to that section 743(b)
CAA, all of the cost recovery amount or
the disposition amount is allocated to that
section 901(m) payor. The U.S. taxable
year of the section 901(m) payor to which
the cost recovery amount or the disposi-
tion amount is assigned is the U.S. taxable
year in which, in the case of a cost re-
covery amount, the section 901(m) payor
takes into account the corresponding U.S.
basis deduction (without regard to wheth-
er the deduction is deferred or disallowed
for U.S. income tax purposes), or in the
case of a disposition amount, the disposi-
tion occurs.
(f) Mid-year transactions—(1) In gen-
eral. When a disposition of an RFA oc-
curs in the same foreign taxable year that
a foreign payor is involved in a mid-year
transaction, the portion of the disposi-
tion amount that is attributable to foreign
disposition gain or foreign disposition
loss (as determined under paragraph (d)
(5) of this section) is allocated to a sec-
tion 901(m) payor and assigned to a U.S.
taxable year of the section 901(m) payor
under this paragraph (f). To the extent the
disposition amount is attributable to U.S.
disposition gain or U.S. disposition loss
(as determined under paragraph (d)(5) of
this section), see paragraph (c)(1) or (d) of
this section, as applicable.
(2) Allocation rule. To the extent a dis-
position amount is attributable to foreign
disposition gain or foreign disposition
loss, a section 901(m) payor is allocated
the portion of the disposition amount equal
to the product of the disposition amount
attributable to foreign disposition gain or
foreign disposition loss, as applicable, and
a fraction, the numerator of which is the
portion of the foreign disposition gain or
foreign disposition loss that is included in
the allocable foreign income of the sec-
tion 901(m) payor, and the denominator
of which is the foreign disposition gain or
foreign disposition loss. If allocable for-
eign income is not otherwise required to
be determined because there is no foreign
income tax amount, the numerator is the
portion of the foreign disposition gain or
foreign disposition loss that would be in-
cluded in the allocable foreign income of
the section 901(m) payor if there were a
foreign income tax amount.
(3) Assignment to a U.S. taxable year
of a section 901(m) payor. A disposition
amount allocated to a section 901(m) pay-
or under paragraph (f)(2) of this section
is assigned to the U.S. taxable year of the
section 901(m) payor in which the foreign
disposition gain or foreign disposition loss
(or portion thereof) is included in alloca-
ble foreign income of the section 901(m)
payor or, if allocable foreign income is
not otherwise required to be determined
because there is no foreign income tax
amount, the U.S. taxable year in which the
foreign disposition gain or foreign dispo-
sition loss would be included in allocable
foreign income if there were a foreign in-
come tax amount.
(g)
Reverse hybrids—(1) In gener-
al. This paragraph (g) provides rules for
allocating a cost recovery amount or a
disposition amount when the RFA owner
(U.S.) is either a reverse hybrid or a fiscal-
ly transparent entity for U.S. and foreign
income tax purposes that is directly or
indirectly owned by a reverse hybrid for
U.S. and foreign income tax purposes, and
in each case, the foreign payor whose for-
eign income includes a distributive share
of the foreign income of the RFA owner
(foreign) directly or indirectly owns an in-
terest in the reverse hybrid for foreign in-
come tax purposes. Application of the al-
location rules under paragraphs (g)(2) and
(g)(3) of this section depend upon whether
a section 901(m) payor or a disregarded
entity directly owned by a section 901(m)
payor is the foreign payor, or, instead, a
section 901(m) payor directly or indirect-
ly owns an interest in the foreign payor.
For purposes of this paragraph (g), unless
otherwise indicated, a reference to direct
or indirect ownership in an entity means
for U.S. income tax purposes. For purpos-
es of this paragraph (g), a person indirect-
ly owns an interest in an entity for U.S.
income tax purposes if the person owns
the interest through one or more fiscally
transparent entities for U.S. income tax
purposes, and at least one of the fiscally
transparent entities is not a disregarded
entity. For purposes of this paragraph (g),
a person indirectly owns an interest in an
entity for foreign income tax purposes if
the person owns the interest through one
or more fiscally transparent entities for
foreign income tax purposes. If the RFA
owner (U.S.) is a lower-tier fiscally trans-
parent entity for U.S. income tax purpos-
es in which the reverse hybrid indirectly
owns an interest, the rules of this section
apply in a manner consistent with the ap-
plication of these rules when the reverse
hybrid directly owns an interest in the
RFA owner (U.S.).
(2) First allocation rule—(i) Allo-
cation to a section 901(m) payor. This
paragraph (g)(2)(i) applies when a section
901(m) payor, or a disregarded entity di-
rectly owned by a section 901(m) payor,
is the foreign payor whose foreign income
includes a distributive share of the for-
eign income of the RFA owner (foreign),
and, therefore, all of the foreign income
tax amount of the foreign payor is paid or
accrued by, or considered paid or accrued
by, the section 901(m) payor. Thus, this
paragraph (g)(2)(i) applies when a sec-
tion 901(m) payor either directly owns an
interest in the reverse hybrid or directly
owns an interest in a fiscally transparent
entity for U.S. and foreign income tax pur-
poses, which, in turn, directly or indirectly
owns an interest in the reverse hybrid for
both U.S. and foreign income tax purpos-
es. In these cases, the section 901(m) pay-
or is allocated the portions of cost recov-
ery amounts or disposition amounts (or

Bulletin No. 2020–15 583 April 6, 2020
both) with respect to RFAs that are equal
to the product of the sum of the cost recov-
ery amounts and the disposition amounts
and a fraction, the numerator of which is
the portion of the foreign income of the
RFA owner (foreign) that is included in
the foreign income of the foreign payor,
and the denominator of which is the for-
eign income of the RFA owner (foreign).
(ii) Assignment to a U.S. taxable year
of a section 901(m) payor. This para-
graph (g)(2)(ii) applies when a cost re-
covery amount or a disposition amount,
or portion thereof, is allocated to a section
901(m) payor under paragraph (g)(2)(i)
of this section. If the reverse hybrid is the
RFA owner (U.S.), a cost recovery amount
or disposition amount, or portion thereof,
is assigned to the U.S. taxable year of the
section 901(m) payor that includes the last
day of the U.S. taxable year of the reverse
hybrid in which, in the case of a cost re-
covery amount, the reverse hybrid takes
into account the corresponding U.S. basis
deduction (without regard to whether the
deduction is deferred or disallowed for
U.S. income tax purposes), or, in the case
of a disposition amount, the disposition
occurs. If the reverse hybrid is not the RFA
owner (U.S.) but instead the reverse hy-
brid directly or indirectly owns an interest
in the RFA owner (U.S.) for both U.S. and
foreign income tax purposes, a cost recov-
ery amount or disposition amount, or por-
tion thereof, is assigned to the U.S. tax-
able year of the section 901(m) payor that
includes the last day of the U.S. taxable
year of the reverse hybrid, which, in turn,
includes the last day of the U.S. taxable
year of the RFA owner (U.S.) in which,
in the case of a cost recovery amount, the
RFA owner (U.S.) takes into account the
corresponding U.S. basis deduction (with-
out regard to whether the deduction is de-
ferred or disallowed for U.S. income tax
purposes), or, in the case of a disposition
amount, the disposition occurs.
(3) Second allocation rule—(i) Alloca-
tion to a section 901(m) payor. This para-
graph (g)(3)(i) applies when neither a sec-
tion 901(m) payor nor a disregarded entity
directly owned by a section 901(m) payor
is the foreign payor with respect to the for-
eign income of the RFA owner (foreign).
Instead, a section 901(m) payor directly or
indirectly owns an interest in the foreign
payor, which is a fiscally transparent entity
for U.S. income tax purposes (other than a
disregarded entity directly owned by the
section 901(m) payor), and, therefore,
the section 901(m) payor is considered
to pay or accrue only its allocated portion
of the foreign income tax amount of the
foreign payor. In these cases, the section
901(m) payor is allocated the portions
of cost recovery amounts or disposition
amounts (or both) with respect to RFAs
that are equal to the product of the sum of
the cost recovery amounts and the dispo-
sition amounts and a fraction, the numer-
ator of which is the portion of the foreign
income of the RFA owner (foreign) that
is included in the foreign income of the
foreign payor and included in the alloca-
ble foreign income of the section 901(m)
payor, and the denominator of which is
the foreign income of the RFA owner (for-
eign). If allocable foreign income is not
otherwise required to be determined for a
section 901(m) payor because there is no
foreign income tax amount, the numerator
is the foreign income of the RFA owner
(foreign) that is included in the foreign in-
come of the foreign payor and that would
be included in allocable foreign income of
the section 901(m) payor if there were a
foreign income tax amount.
(ii) Assignment to a U.S. taxable year
of a section 901(m) payor. A cost recov-
ery amount or a disposition amount, or
portion thereof, that is allocated to a sec-
tion 901(m) payor under paragraph (g)(3)
(i) of this section is assigned to the U.S.
taxable year of the section 901(m) payor
in which the foreign income of the RFA
owner (foreign) described in paragraph
(g)(3)(i) of this section is included in the
allocable foreign income of the section
901(m) payor, or, if there is no foreign
income tax amount, the U.S. taxable year
of the section 901(m) payor in which the
foreign income of the RFA owner (for-
eign) described in paragraph (g)(3)(i) of
this section would be included in alloca-
ble foreign income if there were a foreign
income tax amount.
(h) Examples. The following examples
illustrate the rules of this section. In addi-
tion to any facts described in a particular
example, the following facts apply to all
the examples unless otherwise specified:
CFC1, CFC2, and DE are organized in
Country F and treated as corporations for
Country F tax purposes. CFC1 and CFC2
are each an applicable foreign corporation
that is wholly owned by the same U.S.
corporation, and DE is a disregarded en-
tity. CFC1 and CFC2 each have a U.S.
taxable year that is a calendar year, and
CFC1, CFC2, and DE each have a for-
eign taxable year that is a calendar year.
Country F imposes a single tax that is a
foreign income tax. CFC1, CFC2, and DE
each have a functional currency of the u
with respect to all activities. At all rele-
vant times, 1u equals $1. All amounts are
stated in millions. The examples assume
that the applicable cost recovery method
for property results in basis being recov-
ered ratably over the life of the property
beginning on the first day of the U.S. tax-
able year in which the property is acquired
or placed into service.
(1) Example 1: CAA followed by disposition:
fully taxable for both U.S. income tax and foreign
income tax purposes—(i) Facts. (A) On January 1,
Year 1, USP acquires all of the stock of CFC1 in a
qualified stock purchase (as defined in section 338(d)
(3)) to which section 338(a) applies (Section 338
Acquisition). At the time of the Section 338 Acqui-
sition, CFC1 owns a single asset (Asset A) that is
located in Country F. Asset A gives rise to income
that is taken into account for Country F tax purpos-
es. Asset A is tangible personal property that, under
the applicable cost recovery method in the hands of
CFC1, is depreciable over 5 years. There are no cost
recovery deductions available for Country F tax pur-
poses with respect to Asset A. Immediately before
the Section 338 Acquisition, Asset A has a U.S. basis
of 10u and a foreign basis of 40u. Immediately after
the Section 338 Acquisition, Asset A has a U.S. basis
of 100u and foreign basis of 40u.
(B) On July 1, Year 2, Asset A is transferred to
an unrelated third party in exchange for 120u in a
transaction in which all realized gain is recognized
for both U.S. income tax and Country F tax purposes
(subsequent transaction). For U.S. income tax pur-
poses, CFC1 recognizes U.S. disposition gain of
50u (amount realized of 120u, less U.S. basis of 70u
(100u cost basis, less 30u of accumulated deprecia-
tion)) with respect to Asset A. The 30u of accumulat-
ed depreciation is the sum of 20u of depreciation in
Year 1 (100u cost basis/5 years) and 10u of deprecia-
tion in Year 2 ((100u cost basis/5 years) x 6/12). For
Country F tax purposes, CFC1 recognizes foreign
disposition gain of 80u (amount realized of 120u,
less foreign basis of 40u) with respect to Asset A.
Immediately after the subsequent transaction, Asset
A has a U.S. basis and a foreign basis of 120u.
(ii) Result. (A) Under §1.901(m)-2(b)(1), USP’s
acquisition of the stock of CFC1 in the Section 338
Acquisition is a section 338 CAA. Under §1.901(m)-
2(c)(i), Asset A is an RFA with respect to Country F
tax because it is relevant in determining the foreign
income of CFC1 for Country F tax purposes. Under
§1.901(m)-4(b), the basis difference with respect to
Asset A is 90u (100u – 10u). Under §1.901(m)-1(a)
(37), CFC1 is the RFA owner (U.S.) with respect
to Asset A. Under §1.901(m)-1(a)(28), CFC1 is a

April 6, 2020 584 Bulletin No. 2020–15
foreign payor for Country F tax purposes. Under
§1.901(m)-1(a)(41), CFC1 is the section 901(m)
payor with respect to a foreign income tax amount
for which CFC1 is the foreign payor (see §1.901-2(f)
(1)).
(B) Under §1.901(m)-1(a)(5), allocated basis
differences are the sum of cost recovery amounts
and disposition amounts. In Year 1, Asset A has an
allocated basis difference that includes only a cost
recovery amount. Under paragraph (b)(2) of this
section, the cost recovery amount for Year 1 is de-
termined by applying the applicable cost recovery
method of Asset A in the hands of CFC1 to the basis
difference with respect to Asset A. Accordingly, the
cost recovery amount is 18u (90u basis difference/5
years). Under paragraph (b)(1) of this section, all of
the 18u cost recovery amount is attributed to CFC1
and assigned to Year 1, because CFC1 is a section
901(m) payor and RFA owner (U.S.) with respect to
Asset A and Year 1 is the U.S. taxable year of CFC1
in which it takes into account the corresponding 20u
of depreciation. Immediately after Year 1, under
§1.901(m)-1(a)(47), unallocated basis difference is
72u with respect to Asset A (90u – 18u).
(C) In Year 2, Asset A has an allocated basis dif-
ference that includes both a cost recovery amount
and a disposition amount. Under paragraph (b)(2)
of this section, the cost recovery amount for Year
2, as of the date of the subsequent transaction, is
9u ((90u basis difference/5 years) x 6/12). Under
§1.901(m)-1(a)(15), the subsequent transaction is a
disposition of Asset A, because the subsequent trans-
action is an event that results in an amount of gain
being recognized for U.S. income tax and Country
F tax purposes. Because all realized gain in Asset
A is recognized for U.S. income tax and Country F
tax purposes, the rule in paragraph (c)(2)(i) of this
section applies to determine the disposition amount.
Under that rule, the disposition amount for Year 2
is the unallocated basis difference of 63u (90u basis
difference, less total 27u taken into account as cost
recovery amounts in Year 1 and Year 2). According-
ly, the allocated basis difference for Year 2 is 72u
(9u of cost recovery amount, plus 63u of disposition
amount). Under paragraphs (b)(1) and (c)(1) of this
section, all of the 72u of allocated basis difference is
attributed to CFC1 and assigned to Year 2, because
CFC1 is a section 901(m) payor and the RFA owner
(U.S.) with respect to Asset A and Year 2 is the U.S.
taxable year of CFC1 in which it takes into account
the corresponding 10u of depreciation and in which
the disposition occurred.
(D) Unallocated basis difference with respect to
Asset A, as determined immediately after the subse-
quent transaction, is 0u (90u basis difference less 90u
basis difference taken into account as 27u total cost
recovery amount in Year 1 and Year 2 and as a 63u
disposition amount in Year 2). Accordingly, because
there is no unallocated basis difference with respect
to Asset A attributable to the Section 338 Acquisi-
tion, the subsequent transaction is not a successor
transaction as defined in §1.901(m)-6(b)(2). Further-
more, the subsequent transaction is not a CAA under
§1.901(m)-2(b). For these reasons, section 901(m)
no longer applies to Asset A.
(2) Example 2: CAA followed by disposition:
nontaxable for U.S. income tax purposes and taxable
for foreign income tax purposes—(i) Facts. The facts
are the same as in paragraph (h)(1)(i)(A) of this sec-
tion (paragraph (i)(A) of Example 1) but the facts in
paragraph (h)(1)(i)(B) of this section (paragraph (i)
(B) of Example 1) are instead that on July 1, Year 2,
Asset A is transferred to CFC2, in exchange for 100u
of stock of CFC2 (subsequent transaction). For U.S.
income tax purposes, CFC1 does not recognize any
U.S. disposition gain or U.S. disposition loss with re-
spect to Asset A. For Country F tax purposes, CFC1
recognizes foreign disposition gain of 60u (amount
realized of 100u, less foreign basis of 40u) with re-
spect to Asset A. Immediately after the subsequent
transaction, Asset A has a U.S. basis of 70u (100u
cost basis less 30u accumulated depreciation) and a
foreign basis of 100u. The 30u of accumulated de-
preciation is the sum of 20u of depreciation in Year
1 (100u cost basis/5 years) and 10u in Year 2 ((100u
cost basis/5 years) x 6/12).
(ii) Result. (A) The results described in para-
graph (h)(1)(ii)(A) of this section (paragraph (ii)(A)
of Example 1) also apply to this paragraph (h)(2)(ii)
(the results of this Example 2).
(B) The result for Year 1 is the same as in para-
graph (h)(1)(ii)(B) of this section (paragraph (ii)(B)
of Example 1).
(C) In Year 2, Asset A has an allocated basis dif-
ference that includes both a cost recovery amount
and a disposition amount. Under paragraph (b)(2) of
this section, the cost recovery amount for Year 2, as
of the date of the subsequent transaction, is 9u ((90u
basis difference/5 years) x 6/12). Under §1.901(m)-
1(a)(15), the subsequent transaction is a disposi-
tion of Asset A, because the subsequent transaction
is an event that results in an amount of gain being
recognized for Country F tax purposes. Because the
disposition is not also fully taxable for U.S. income
tax purposes, the rule in paragraph (c)(2)(ii) of this
section applies to determine the disposition amount.
Under that rule, the disposition amount is 60u, the
lesser of (i) 60u (60u foreign disposition gain plus
absolute value of 0u U.S. disposition loss), and (ii)
63u unallocated basis difference (90 basis difference
less total 27u taken into account as cost recovery
amounts, 18u in Year 1 and 9u in Year 2). According-
ly, the allocated basis difference for the first half of
Year 2 is 69u (9u of cost recovery amount, plus 60u
of disposition amount). Under paragraphs (b)(1) and
(c)(1) of this section, all of the 69u of allocated basis
difference is attributed to CFC1 and assigned to Year
2, because CFC1 is a section 901(m) payor and the
RFA owner (U.S.) with respect to Asset A and Year
2 is the U.S. taxable year of CFC1 in which it takes
into account the corresponding 10u of depreciation
and in which the disposition occurred.
(D) Unallocated basis difference with respect to
Asset A immediately after the subsequent transac-
tion is 3u (90u basis difference less 87u basis differ-
ence taken into account as a 27u total cost recovery
amount in Year 1 and Year 2 and as a 60u disposi-
tion amount in Year 2). Accordingly, because there
is unallocated basis difference of 3u with respect to
Asset A attributable to the Section 338 Acquisition,
as determined immediately after the subsequent
transaction, the subsequent transaction is a successor
transaction as defined in §1.901(m)-6(b)(2). Follow-
ing the subsequent transaction, the unallocated basis
difference of 3u must be taken into account as cost
recovery amounts or disposition amounts (or both)
by CFC2, the new section 901(m) payor and RFA
owner (U.S.) of Asset A. See §1.901(m)-6(b)(3)(ii).
Because the subsequent transaction is not a CAA
under §1.901(m)-2(b), there is no additional basis
difference with respect to Asset A as a result of the
subsequent transaction.
(3) Example 3: CAA followed by disposition:
nontaxable for both U.S. income tax and foreign
income tax purposes—(i) Facts. The facts are the
same as in paragraph (h)(1)(i)(A) of this section
(paragraph (i)(A) of Example 1) but the facts in
paragraph (h)(1)(i)(B) of this section (paragraph (i)
(B) of Example 1) are instead that on July 1, Year
2, CFC1 transfers Asset A to CFC2, in exchange for
110u of stock of CFC2 (subsequent transaction). For
U.S. income tax purposes, CFC1 does not recognize
any U.S. disposition gain or U.S. disposition loss
with respect to Asset A as a result of the subsequent
transaction. Furthermore, for Country F tax purpos-
es, CFC1 recognizes no foreign disposition gain or
foreign disposition loss with respect to Asset A as
a result of the subsequent transaction. Immediately
after the subsequent transaction, Asset A has a U.S.
basis of 70u (100u cost basis less 30u accumulated
depreciation) and a foreign basis of 40u. The 30u of
accumulated depreciation is the sum of 20u of depre-
ciation in Year 1 (100u cost basis/5 years) and 10u in
Year 2 ((100u cost basis/5 years) x 6/12).
(ii) Result. (A) The result for Year 1 is the same
as in paragraph (h)(1)(ii)(A) of this section (para-
graph (ii)(A) of Example 1).
(B) The result for Year 1 is the same as in para-
graph (h)(1)(ii)(B) of this section (paragraph (ii)(B)
of Example 1).
(C) In Year 2, Asset A has an allocated basis dif-
ference that includes only a cost recovery amount.
Under paragraph (b)(2) of this section, the cost re-
covery amount for Year 2, as of the date of the sub-
sequent transaction, is 9u ((90u basis difference/5
years) x 6/12). Under §1.901(m)-1(a)(15), the subse-
quent transaction does not constitute a disposition of
Asset A, because the subsequent transaction is not an
event that results in an amount of gain or loss being
recognized for U.S. income tax or for Country F tax
purposes. Therefore, no disposition amount is taken
into account for Asset A in Year 2. Under paragraph
(b)(1) of this section, all of the 9u of allocated basis
difference is attributed to CFC1 and assigned to Year
2, because CFC1 is a section 901(m) payor and RFA
owner (U.S.) with respect to Asset A and Year 2 is
the U.S. taxable year of CFC1 in which it takes into
account the corresponding 10u of depreciation.
(D) Unallocated basis difference with respect to
Asset A immediately after the subsequent transaction
is 63u (90u basis difference, less 27u total cost re-
covery amounts, 18u in Year 1 and 9u in Year 2).
Accordingly, because there is unallocated basis dif-
ference of 63u with respect to Asset A attributable
to the CAA, as determined immediately after the
subsequent transaction, the subsequent transaction
is a successor transaction as defined in §1.901(m)-
6(b)(2). Following the subsequent transaction, the
unallocated basis difference of 63u must be taken
into account as cost recovery amounts or disposi-
tion amounts (or both) by CFC2, the new section
901(m) payor and RFA owner (U.S.) of Asset A. See
§1.901(m)-6(b)(3)(ii). Because the subsequent trans-
action is not a CAA under §1.901(m)-2(b), there is

Bulletin No. 2020–15 585 April 6, 2020
no additional basis difference with respect to Asset A
as a result of the subsequent transaction.
(i) Applicability dates. (1) Except as
provided in paragraph (i)(2) of this sec-
tion, this section applies to CAAs occur-
ring on or after March 23, 2020.
(2) Paragraphs (b)(2)(i) and (c)(2) of
this section apply to CAAs occurring on
or after July 21, 2014, and to CAAs oc-
curring before that date resulting from an
entity classification election made under
§301.7701-3 of this chapter that is filed
on or after July 29, 2014, and that is ef-
fective on or before July 21, 2014. Para-
graphs (b)(2)(i) and (c)(2) of this section
also apply to CAAs occurring on or after
January 1, 2011, and before July 21, 2014,
other than CAAs occurring before July
21, 2014, resulting from an entity classi-
fication election made under §301.7701-3
that is filed on or after July 29, 2014, and
that is effective on or before July 21, 2014,
but only with respect to basis difference
determined under §1.901(m)-4T(e) with
respect to the CAA.
(3) Taxpayers may, however, choose to
apply provisions in this section before the
date such provisions are applicable pur-
suant to paragraphs (i)(1) and (2) of this
section, provided that they (along with
any persons that are related (within the
meaning of section 267(b) or 707(b)) to
the taxpayer)—
(i) Consistently apply this section,
§1.704-1(b)(4)(viii)(c)(4)(v) through (vii),
§1.901(m)-1, §1.901(m)-3, §1.901(m)-4
(excluding §1.901(m)-4(e)), §1.901(m)-
6, §1.901(m)-7, and §1.901(m)-8 to all
CAAs occurring on or after January 1,
2011, and consistently apply §1.901(m)-2
(excluding §1.901(m)-2(d)) to all CAAs
occurring on or after December 7, 2016,
on any original or amended tax return for
each taxable year for which the applica-
tion of the provisions listed in this para-
graph (i)(3)(i) affects the tax liability and
for which the statute of limitations does
not preclude assessment or the filing of a
claim for refund, as applicable;
(ii) File all tax returns described in
paragraph (i)(3)(i) of this section for any
taxable year ending on or before March
23, 2020, no later than March 23, 2021;
and
(ii) Make appropriate adjustments to
take into account deficiencies that would
have resulted from the consistent applica-
tion under paragraph (i)(3)(i) of this sec-
tion for taxable years that are not open for
assessment.
§1.901(m)-5T [Removed]
Par. 12. Section 1.901(m)-5T is re-
moved.
Par. 13. Section 1.901(m)-6 is added to
read as follows:
§1.901(m)-6 Successor rules.
(a) In general. This section provides
successor rules applicable to section
901(m). Paragraph (b) of this section
provides rules for the continued applica-
tion of section 901(m) after an RFA that
has unallocated basis difference has been
transferred, including special rules appli-
cable to successor transactions that are
also CAAs or that involve partnerships.
Paragraph (c) of this section provides rules
for determining when an aggregate basis
difference carryover of a section 901(m)
payor either becomes an aggregate basis
difference carryover of the section 901(m)
payor with respect to another foreign
payor or is transferred to another section
901(m) payor, and paragraph (d) of this
section provides applicability dates.
(b) Successor rules for unallocated
basis difference—(1) In general. Except
as provided in paragraph (b)(4) of this
section, section 901(m) continues to ap-
ply after a successor transaction to any
unallocated basis difference attached to
a transferred RFA until the entire basis
difference has been taken into account as
a cost recovery amount or a disposition
amount (or both) under §1.901(m)-5.
(2) Definition of a successor transac-
tion. A successor transaction occurs with
respect to an RFA if, after a CAA (prior
CAA), there is a transfer of the RFA for
U.S. income tax purposes and the RFA has
unallocated basis difference with respect
to the prior CAA, determined immediately
after the transfer. A successor transaction
may occur regardless of whether the trans-
fer of the RFA is a disposition, a CAA, or
a non-taxable transaction for purposes of
U.S. income tax. If the RFA was subject to
multiple prior CAAs, a separate determi-
nation must be made with respect to each
prior CAA as to whether the transfer is a
successor transaction.
(3) Special considerations. (i) If an as-
set is an RFA with respect to more than
one foreign income tax, this paragraph
(b) applies separately with respect to each
foreign income tax.
(ii) Any subsequent cost recovery
amount for an RFA transferred in a suc-
cessor transaction is determined based on
the post-transaction applicable cost recov-
ery method, as described in §1.901(m)-
5(b)(3), that applies to the U.S. basis (or
portion thereof) that corresponds to the
unallocated basis difference.
(4) Successor transaction is a CAA—
(i) In general. An asset may be an RFA
with respect to multiple CAAs if a succes-
sor transaction is also a CAA (subsequent
CAA). Except as otherwise provided in
this paragraph (b)(4), if there is a subse-
quent CAA, unallocated basis difference
with respect to any prior CAAs will con-
tinue to be taken into account under sec-
tion 901(m) after the subsequent CAA.
Furthermore, the subsequent CAA may
give rise to additional basis difference
subject to section 901(m).
(ii) Foreign basis election. If a foreign
basis election is made under §1.901(m)-
4(c) with respect to a foreign income tax
in a subsequent CAA, any unallocated ba-
sis difference with respect to one or more
prior CAAs will not be taken into account
under section 901(m). The only basis dif-
ference that will be taken into account
after the subsequent CAA with respect to
that foreign income tax is the basis differ-
ence with respect to the subsequent CAA.
(iii) Multiple section 743(b) CAAs. If
an RFA is subject to two section 743(b)
CAAs (prior section 743(b) CAA and sub-
sequent section 743(b) CAA) and the same
partnership interest is acquired in both the
CAAs, the RFA will be treated as having
no unallocated basis difference with re-
spect to the prior section 743(b) CAA if
the basis difference for the section 743(b)
CAA is determined independently from
the prior section 743(b) CAA. In this re-
gard, see generally §1.743-1(f). If the sub-
sequent section 743(b) CAA results from
the acquisition of only a portion of the
partnership interest acquired in the prior
section 743(b) CAA, then the transferor
will be required to equitably apportion the
unallocated basis difference attributable to
the prior section 743(b) CAA between the
portion retained by the transferor and the

April 6, 2020 586 Bulletin No. 2020–15
portion transferred. In this case, with re-
spect to the portion transferred, the RFAs
will be treated as having no unallocated
basis difference with respect to the prior
section 743(b) CAA if basis difference
for the subsequent section 743(b) CAA is
determined independently from the prior
section 743(b) CAA.
(5) Example. The following example
illustrates the rules of paragraph (b) of this
section.
(i) Facts. USP, a domestic corporation, wholly
owns CFC, a foreign corporation organized in Coun-
try A and treated as a corporation for both U.S. and
Country A tax purposes. FT is an unrelated foreign
corporation organized in Country A and treated as
a corporation for both U.S. and Country A tax pur-
poses. FT owns one asset, a parcel of land (Asset).
Country A imposes a single tax that is a foreign in-
come tax. On January 1, Year 1, CFC acquires all of
the stock of FT in exchange for 300u in a qualified
stock purchase (as defined in section 338(d)(3)) to
which section 338(a) applies (Acquisition). Immedi-
ately before the Acquisition, Asset had a U.S. basis
of 100u, and immediately after the Acquisition, As-
set had a U.S. basis of 300u. Effective on February
1, Year 1, FT elects to be a disregarded entity pursu-
ant to §301.7701-3. As a result of the election, FT is
deemed, for U.S. income tax purposes, to distribute
Asset to CFC in liquidation (Deemed Liquidation)
immediately before the closing of the day before the
election is effective pursuant to §301.7701-3(g)(1)
(iii) and (3)(ii). The Deemed Liquidation is disre-
garded for Country A tax purposes. No gain or loss
is recognized on the Deemed Liquidation for either
U.S. or Country A tax purposes.
(ii) Result. Under §1.901(m)-2(b)(1), the acquisi-
tion by CFC of the stock of FT is a section 338 CAA.
Under §1.901(m)-2(c)(1), Asset is an RFA with re-
spect to Country A tax and the Acquisition, because
immediately after the Acquisition, Asset is relevant
in determining foreign income of FT for Country A
tax purposes, and FT owned Asset when the Acqui-
sition occurred. Under §1.901(m)-4(b), the basis dif-
ference with respect to Asset is 200u (300u – 100u).
Under §1.901(m)-2(b)(2), the Deemed Liquidation is
a CAA (subsequent CAA) because the Deemed Liq-
uidation is treated as an acquisition of assets for U.S.
income tax purposes and is disregarded for Country
A tax purposes. Because the U.S. basis in Asset is
300u immediately before and after the Deemed Liq-
uidation, the subsequent CAA does not give rise to
any additional basis difference. The Deemed Liq-
uidation is not a disposition under §1.901(m)-1(a)
(15) because it did not result in gain or loss being
recognized with respect to Asset for U.S. or Coun-
try A tax purposes. Accordingly, no basis difference
with respect to Asset is taken into account under
§1.901(m)-5 as a result of the Deemed Liquidation,
and the unallocated basis difference with respect to
Asset immediately after the Deemed Liquidation is
200u (200u – 0u). Under paragraph (b)(2) of this sec-
tion, the Deemed Liquidation is a successor trans-
action because there is a transfer of Asset for U.S.
income tax purposes from FT to CFC and Asset has
unallocated basis difference with respect to the Ac-
quisition immediately after the Deemed Liquidation.
Accordingly, under paragraph (b)(1) of this section,
section 901(m) will continue to apply to the unal-
located basis difference with respect to Asset until
the entire 200u basis difference has been taken into
account under §1.901(m)-5.
(c) Successor rules for aggregate ba-
sis difference carryover—(1) Transfers of
a section 901(m) payor’s aggregate basis
difference carryover to another person.
If a corporation acquires the assets of a
section 901(m) payor in a transaction to
which section 381 applies, that corpora-
tion succeeds to any aggregate basis dif-
ference carryovers of the section 901(m)
payor.
(2) Transfers of a section 901(m) pay-
or’s aggregate basis difference carryover
with respect to a foreign payor to another
foreign payor. If a section 901(m) payor
has an aggregate basis difference carry-
over, with respect to a foreign income tax
and a foreign payor, and substantially all
of the assets of the foreign payor are trans-
ferred to another foreign payor in which
the section 901(m) payor owns an interest,
the section 901(m) payor’s aggregate ba-
sis difference carryover with respect to the
first foreign payor is transferred to the sec-
tion 901(m) payor’s aggregate basis dif-
ference carryover with respect to the other
foreign payor. In such a case, the section
901(m) payor’s aggregate basis difference
carryover with respect to the first foreign
payor is reduced to zero.
(3) Anti-abuse rule. If a section 901(m)
payor has an aggregate basis difference
carryover with respect to a foreign income
tax and a foreign payor and, with a princi-
pal purpose of avoiding the application of
section 901(m), assets of the foreign pay-
or are transferred to another foreign pay-
or in a transaction not described in para-
graph (c)(1) or (2) of this section, then a
portion of the aggregate basis difference
carryover of the section 901(m) payor is
transferred either to the aggregate basis
difference carryover of the section 901(m)
payor with respect to the other foreign
payor or to another section 901(m) payor,
as appropriate. The portion of the aggre-
gate basis difference carryover transferred
is determined based on the ratio of fair
market value of the assets transferred to
the fair market value of all of the assets of
the foreign payor that transferred the as-
sets. Similar principles apply when, with
a principal purpose of avoiding the appli-
cation of section 901(m), there is a change
in the allocation of foreign income for for-
eign income tax purposes or the allocation
of foreign income tax amounts for U.S.
income tax purposes that would otherwise
separate foreign income tax amounts from
the related aggregate basis difference car-
ryover.
(4) Ownership. For purposes of this
paragraph (c), a section 901(m) payor
owns an interest in a foreign payor if the
section 901(m) payor owns the interest
directly or indirectly through one or more
fiscally transparent entities for U.S. in-
come tax purposes.
(d) Applicability dates—(1) Except as
provided in paragraph (d)(2) of this sec-
tion, this section applies to CAAs occur-
ring on or after March 23, 2021.
(2) Paragraphs (a), (b)(1) and (2), (b)
(4)(i) and (iii), and (b)(5) of this section
apply to CAAs occurring on or after July
21, 2014, and to CAAs occurring before
that date resulting from an entity classi-
fication election made under §301.7701-
3 of this chapter that is filed on or after
July 29, 2014, and that is effective on or
before July 21, 2014. Paragraphs (a), (b)
(1) and (2), (b)(4)(i) and (iii), and (b)(5)
of this section also apply to CAAs oc-
curring on or after January 1, 2011, and
before July 21, 2014, other than CAAs
occurring before July 21, 2014, resulting
from an entity classification election made
under §301.7701-3 that is filed on or af-
ter July 29, 2014, and that is effective on
or before July 21, 2014, but only with re-
spect to basis difference determined under
§1.901(m)-4T(e) with respect to the CAA.
(3) Taxpayers may, however, choose to
apply provisions in this section before the
date such provisions are applicable pur-
suant to paragraphs (d)(1) and (2) of this
section, provided that they (along with
any persons that are related (within the
meaning of section 267(b) or 707(b)) to
the taxpayer)—
(i) Consistently apply this section,
§1.704-1(b)(4)(viii)(c)(4)(v) through
(vii), §1.901(m)-1, §§1.901(m)-3 through
1.901(m)-5 (excluding §1.901(m)-4(e)),
§1.901(m)-7, and §1.901(m)-8 to all
CAAs occurring on or after January 1,
2011, and consistently apply §1.901(m)-2
(excluding §1.901(m)-2(d)) to all CAAs
occurring on or after December 7, 2016,
on any original or amended tax return for

Bulletin No. 2020–15 587 April 6, 2020
each taxable year for which the applica-
tion of the provisions listed in this para-
graph (d)(3)(i) affects the tax liability and
for which the statute of limitations does
not preclude assessment or the filing of a
claim for refund, as applicable;
(ii) File all tax returns described in
paragraph (d)(3)(i) of this section for any
taxable year ending on or before March
23, 2020, no later than March 23, 2021;
and
(iii) Make appropriate adjustments to
take into account deficiencies that would
have resulted from the consistent applica-
tion under paragraph (d)(3)(i) of this sec-
tion for taxable years that are not open for
assessment.
§1.901(m)-6T [Removed]
Par. 14. Section 1.901(m)-6T is re-
moved.
Par. 15. Section 1.901(m)-7 is added to
read as follows:
§1.901(m)-7 De minimis rules.
(a) In general. This section provides
rules describing basis difference that is not
taken into account under section 901(m)
because a CAA results in a de minimis
amount of basis difference. Paragraph (b)
of this section sets forth the general rule
for determining whether the de minimis
threshold is met. Paragraph (c) of this sec-
tion modifies the general rule in the case
of CAAs that are part of an aggregated
CAA transaction. Paragraph (d) of this
section provides rules for applying this
section, and paragraph (e) of this section
provides an anti-abuse rule applicable to
related persons. Paragraph (f) of this sec-
tion provides examples that illustrate the
application of this section. Paragraph (g)
of this section provides applicability dates.
(b) General rule—(1) In general. A ba-
sis difference with respect to an RFA and
a foreign income tax is not taken into ac-
count under section 901(m) if the require-
ments under the cumulative basis differ-
ence exemption, the RFA class exemption,
or the RFA exemption are satisfied.
(2) Cumulative basis difference exemp-
tion. Except as provided in paragraph (c)
of this section, a basis difference, with
respect to an RFA and a foreign income
tax, is not taken into account under sec-
tion 901(m) (cumulative basis difference
exemption) if the sum of that basis differ-
ence and all other basis differences (in-
cluding negative basis differences), with
respect to a single CAA and a single RFA
owner (U.S.), is less than the greater of:
(i) $10 million, or
(ii) 10 percent of the total U.S. basis of
all the RFAs immediately after the CAA.
(3) RFA class exemption—(i) Except as
provided in paragraph (c) of this section,
a basis difference, with respect to an RFA
and a foreign income tax, is not taken into
account under section 901(m) (RFA class
exemption) if the RFA is part of a class of
RFAs and the absolute value of the sum of
the basis differences (including negative
basis differences), with respect to a single
CAA and a single RFA owner, for all the
RFAs in that class is less than the greater
of:
(A) $2 million, or
(B) 10 percent of the total U.S. basis of
all the RFAs in that class of RFAs imme-
diately after the CAA.
(ii) For purposes of this paragraph (b)
(3), the classes of RFAs are the seven asset
classes defined in §1.338-6(b), regardless
of whether the CAA is a section 338 CAA.
(4) RFA exemption. A basis differ-
ence, with respect to an RFA and a for-
eign income tax, is not taken into account
under section 901(m) (RFA exemption)
if the absolute value of the basis differ-
ence with respect to the RFA is less than
$20,000.
(c) Special rule if a CAA is part of an
aggregated CAA transaction. If a CAA
is part of an aggregated CAA transaction
and a single RFA owner (U.S.) does not
own all the RFAs attributable to the CAAs
that are part of the aggregated CAA trans
-
action, the cumulative basis difference
exemption and the RFA class exemption
apply to such CAA only if, in addition to
satisfying the requirements of paragraph
(b)(2) or (b)(3) of this section, respective-
ly, determined without regard to this para-
graph (c), the cumulative basis difference
exemption or the RFA class exemption, as
modified by this paragraph (c), is satisfied.
Solely for purposes of this paragraph (c),
the cumulative basis difference exemption
and the RFA class exemption are applied
taking into account all the basis differenc-
es with respect to all the RFAs owned by
all the RFA owners (U.S.) that are attrib-
utable to the CAAs that are part of the ag-
gregated CAA transaction.
(d) Rules of application. The following
rules apply for purposes of this section.
(1) Whether a basis difference qualifies
for the cumulative basis difference ex-
emption, the RFA class exemption, or the
RFA exemption is determined when an as-
set first becomes an RFA with respect to
a CAA. In the case of a subsequent CAA
described in §1.901(m)-6(b)(4), the appli-
cation of the cumulative basis difference
exemption, the RFA class exemption, and
the RFA exemption is based on basis dif-
ference, if any, that results from the subse-
quent CAA.
(2) If there is an aggregated CAA trans-
action, the cumulative basis difference ex-
emption and each RFA class exemption
are applied by treating all CAAs that are
part of the aggregated CAA transaction as
a single CAA.
(3) Basis difference is computed in
accordance with §1.901(m)-4 except that
a foreign basis election need not be evi-
denced if the cumulative basis difference
exemption, an RFA class exemption, or
the RFA exemption apply to all RFAs with
respect to the CAA.
(4) Basis difference is translated into
U.S. dollars (if necessary) using the spot
rate determined under the principles of
§1.988-1(d) on the date of the CAA.
(e) Anti-abuse rule. The cumulative
basis difference exemption, an RFA class
exemption, and the RFA exemption are
not available if the transferor and trans-
feree in the CAA are related persons (as
described in section 267(b) or 707(b)) and
the CAA was entered into, or structured,
with a principal purpose of avoiding the
application of section 901(m). See also
§1.901(m)-8(c), which provides that cer-
tain built-in loss assets are not taken into
account for purposes of applying this sec-
tion.
(f) Examples. The following examples
illustrate the rules of this section:
(1) Example 1: De minimis; cumulative basis dif-
ference exemption—(i) Facts. USP, a domestic cor-
poration, as part of a plan, purchases all of the stock
of CFC1 and CFC2 from a single seller. CFC1 and
CFC2 are applicable foreign corporations, organized
in Country F, and treated as corporations for Country
F tax purposes. Country F imposes a single tax that is
a foreign income tax. Each acquisition is a qualified
stock purchase (as defined in section 338(d)(3)) to
which section 338(a) applies. A foreign basis elec-
tion is not made under §1.901(m)-4(c). Immediately

April 6, 2020 588 Bulletin No. 2020–15
after the acquisition of the stock of CFC1 and CFC2,
the assets of CFC1 and CFC2 give rise to income
that is taken into account for Country F tax purposes,
and those assets are in a single class, as defined in
§1.338-6(b). Assume that the absolute value of the
basis difference with respect to any single RFA is
greater than $20,000. At all relevant times, 1u equals
$1. All amounts are stated in millions. The additional
facts are summarized below.
Relevant
Foreign Assets
Total U.S. Basis
Immediately
Before
Total U.S. Basis
Immediately After
Total Basis
Difference
Assets of CFC148u60u12u
Assets of CFC2
100u96u (4)u
Total
148u156u8u
(ii) Result. (A) Under §1.901(m)-2(b)(1), USP’s
acquisitions of the stock of CFC1 and CFC2 are
each a section 338 CAA. Under 1.901(m)-1(a)(3),
the two section 338 CAAs constitute an aggregated
CAA transaction because the acquisitions occur as
part of a plan. Under §1.901(m)-2(c)(1), the assets of
CFC1 and CFC2 are RFAs for Country F tax purpos-
es because they are relevant in determining foreign
income of CFC1 and CFC 2, respectively, for Coun-
try F tax purposes. Under §1.901(m)-1(a)(37), CFC1
is the RFA owner (U.S.) with respect to its assets,
and CFC2 is the RFA owner (U.S.) with respect to
its assets.
(B) Under paragraph (b)(2) of this section, the
application of the cumulative basis difference ex-
emption is based on a single CAA and a single RFA
owner (U.S.), subject to the requirements under
paragraph (c) of this section that apply when there
is an aggregated CAA transaction. In the case of
the section 338 CAA with respect to CFC1, without
regard to paragraph (c) of this section, the require-
ments of the cumulative basis difference exemption
are satisfied if the sum of the basis differences is less
than the threshold of $10 million, the greater of $10
million or $6 million (10% of the total U.S. basis of
$60 million (60 million u translated into dollars at
the exchange rate of $1 = 1u)). In this case, the sum
of the basis differences is $12 million (12 million u
translated into dollars at the exchange rate of $1 = 1
u). Because the sum of the basis differences of $12
million is not less than the threshold of $10 million,
the requirements of the cumulative basis difference
exemption are not satisfied. Because the require-
ments of the cumulative basis difference exemption
are not satisfied, without regard to paragraph (c) of
this section, paragraph (c) of this section is not appli-
cable. The RFA class exemption is not relevant be-
cause all of the RFAs of CFC1 are in a single class.
Finally, because the absolute value with respect to
each RFA is greater than $20,000, the RFA exemp-
tion does not apply. Accordingly, the basis differenc-
es with respect to all of the RFAs of CFC1 must be
taken into account under section 901(m).
(C) In the case of the section 338 CAA with re-
spect to CFC2, without regard to paragraph (c) of
this section, the requirements of the cumulative basis
difference exemption are satisfied if the sum of the
basis differences is less than the threshold of $10
million, the greater of $10 million or $ 9.6 million
(10% of the total U.S. basis of $96 million (96 mil-
lion u translated into dollars at the exchange rate of
$1 = 1u)) In this case, the sum of the basis differenc-
es is ($4) million ((4) million u translated into dollars
at the exchange rate of $1 = 1 u). Because the sum
of the basis differences of ($4) million is less than
the threshold of $10 million, the requirements of the
cumulative basis difference exemption are satisfied.
However, because the section 338 CAA with respect
to CFC2 is part of an aggregated CAA transaction
that includes the section 338 CAA with respect to
CFC1, paragraph (c) of this section is applicable.
Under paragraph (c) of this section, the requirements
of the cumulative basis difference exemption must
also be satisfied taking into account all of the RFAs
of both CFC2 and CFC1. In this case, the require-
ments of the cumulative basis difference exemption
for purposes of paragraph (c) of this section are sat-
isfied if the sum of the basis differences with respect
to all of the RFAs of CFC2 and CFC1 is less than the
threshold of $15.6 million, the greater of $10 mil-
lion or $15.6 million (10% of the total U.S. basis of
$156 million (156 million u translated into dollars
at the exchange rate of $1 = 1u)). In this case, the
sum of the basis differences is $8 million (8 million
u translated into dollars at the exchange rate of $1 =
1 u). Because the sum of the basis differences of $8
million is less than the threshold of $15.6 million,
the requirements of the cumulative basis difference
exemption are satisfied in the case of the section 338
CAA with respect to CFC2. Accordingly, none of the
basis differences with respect to the RFAs of CFC2
are taken into account under section 901(m).
(2) Example 2: De minimis; RFA Class Exemp-
tion—(i) Facts. USP, a domestic corporation, ac-
quires all the stock of CFC, an applicable foreign
corporation organized in Country F and treated as a
corporation for Country F tax purposes, in a quali-
fied stock purchase (as defined in section 338(d)(3))
to which section 338(a) applies. Country F imposes
a single tax that is a foreign income tax. A foreign
basis election is not made under §1.901(m)-4(c).
Immediately after the acquisition of CFC, the as-
sets of CFC give rise to income that is taken into
account for Country F tax purposes. Assume that
the absolute value of the basis difference with re-
spect to any single RFA is greater than $20,000. At
all relevant times, 1u equals $1. All amounts are
stated in millions. The additional facts are summa-
rized below.
Relevant
Foreign Assets
Total U.S. Basis
Immediately
Before
Total U.S. Basis
Immediately After
Total Basis
Difference
Cash (Class I)10u10u 0u
Inventory (Class IV)14u15u 1u
Buildings (Class V)
19u30u11u
Total
43u55u12u
(ii) Result. (A) Under §1.901(m)-2(b)(1), USP’s
acquisition of the stock of CFC is a section 338
CAA. Under §1.901(m)-2(c)(1), the assets of CFC
are RFAs for Country F tax purposes because they
are relevant in determining foreign income of CFC
for Country F tax purposes.
(B) Under paragraph (b)(2) of this section, the
requirements of the cumulative basis difference ex-
emption are satisfied if the sum of the basis differ-
ences is less than the threshold of $10 million, the
greater of $10 million or $5.5 million (10% of the to-
tal U.S. basis of $55 million (55 million u translated
into dollars at the exchange rate of $1 = 1u)). In this
case, the sum of the basis differences is $12 million
(12 million u translated into dollars at the exchange
rate of $1 = 1 u). Because the sum of the basis differ-
ences of $12 million is not less than the threshold of
$10 million, the requirements of the cumulative basis
difference exemption are not satisfied.
(C) Under paragraph (b)(3) of this section, each
of CFC’s assets is allocated to its class under §1.338-
6(b) for purposes of the RFA class exemption. The
requirements of the RFA class exemption with re-
spect to the Class IV RFAs (in this case, inventory)
are satisfied if the absolute value of the sum of the
basis differences with respect to the Class IV RFAs is
less than the threshold of $2 million, the greater of $2
million or $1.5 million (10% of the total U.S. basis
of Class IV RFAs of $15 million (15 million u trans-
lated into dollars at the exchange rate of $1 = 1u)). In
this case, the absolute value of the sum of the basis
differences is $1 million (1 million u translated into
dollars at the exchange rate of $1 = 1 u). Because the

Bulletin No. 2020–15 589 April 6, 2020
sum of the basis differences of $1 million is less than
the threshold of $2 million, the requirements of the
RFA class exemption are satisfied. Accordingly, the
basis differences with respect to the Class IV RFAs
are not taken into account under section 901(m).
(D) The requirements of the RFA class exemp-
tion with respect to the Class V RFAs (in this case,
buildings) is satisfied if the absolute value of the sum
of the basis differences with respect to the Class V
RFAs is less than the threshold of $3 million, the
greater of $2 million or $3 million (10% of the total
U.S. basis of Class V RFAs of $30 million (30 mil-
lion u translated into dollars at the exchange rate of
$1 = 1u)). In this case, the absolute value of the sum
of the basis differences is $11 million (11 million u
translated into dollars at the exchange rate of $1 = 1
u). Because the sum of the basis differences of $11
million is not less than the threshold of $3 million,
the requirements of the RFA class exemption are not
satisfied. Finally, because the absolute value with re-
spect to each RFA is greater than $20,000, the RFA
exemption does not apply. Accordingly, the basis dif-
ferences with respect to the Class V RFAs are taken
into account under section 901(m).
(E) The Class I RFAs (in this case, cash) are ir-
relevant because there are no basis differences with
respect to those RFAs.
(g) Applicability dates. This section
applies to CAAs occurring on or after
March 23, 2020. Taxpayers may, how-
ever, choose to apply this section before
the date this section is applicable provid-
ed that they (along with any persons that
are related (within the meaning of section
267(b) or 707(b)) to the taxpayer)—
(1) Consistently apply this section,
§1.704-1(b)(4)(viii)(c)(4)(v) through
(vii), §1.901(m)-1, §§1.901(m)-3 through
1.901(m)-6 (excluding §1.901(m)-4(e)),
and §1.901(m)-8 to all CAAs occurring on
or after January 1, 2011, and consistently
apply §1.901(m)-2 (excluding §1.901(m)-
2(d)) to all CAAs occurring on or after
December 7, 2016, on any original or
amended tax return for each taxable year
for which the application of the provisions
listed in this paragraph (g)(1) affects the
tax liability and for which the statute of
limitations does not preclude assessment
or the filing of a claim for refund, as ap-
plicable;
(2) File all tax returns described in
paragraph (g)(1) of this section for any
taxable year ending on or before March
23, 2020, no later than March 23, 2021;
and
(3) Make appropriate adjustments to
take into account deficiencies that would
have resulted from the consistent applica-
tion under paragraph (g)(1) of this section
for taxable years that are not open for as-
sessment.
§1.901(m)-7T [Removed]
Par. 16. Section 1.901(m)-7T is re-
moved.
Par. 17. Section 1.901(m)-8 is added to
read as follows:
§1.901(m)-8 Miscellaneous.
(a) In general. This section provides
guidance on other matters under section
901(m). Paragraph (b) of this section pro-
vides guidance on the application of sec-
tion 901(m) to pre-1987 foreign income
taxes. Paragraph (c) of this section pro-
vides anti-abuse rules relating to built-in
loss assets. Paragraph (d) of this section
provides guidance on the interaction of
section 901(m) and section 909. Para-
graph (e) of this section provides applica-
bility dates.
(b) Application of section 901(m) to
pre-1987 foreign income taxes. Section
901(m) and §§1.901(m)-1 through 1.901-
8 apply to pre-1987 foreign income taxes
(as defined in §1.902-1(a)(10)(iii)) of an
applicable foreign corporation.
(c) Anti-abuse rule for built-in loss
RFAs. A basis difference with respect to
an RFA described in section 901(m)(3)(C)
(ii) (built-in loss RFA) will not be taken
into account for purposes of computing an
allocated basis difference for a U.S. tax-
able year of a section 901(m) payor if any
RFA, including an RFA other than built-
in loss RFAs, is acquired with a principal
purpose of using one or more built-in loss
RFAs to avoid the application of section
901(m). Furthermore, a basis difference
with respect to a built-in loss RFA will
not be taken into account for purposes of
the cumulative basis difference exemp-
tion or the RFA class exemption under
§1.901(m)-7 if any RFAs, including RFAs
other than built-in loss RFAs, are acquired
with a principal purpose of avoiding the
application of section 901(m).
(d) Interaction with section 909. The
amount of a foreign income tax that is
disqualified under section 901(m) is deter-
mined before applying section 909. How-
ever, section 909 may apply to suspend a
deduction for the amount of a foreign in-
come tax that is disqualified under section
901(m).
(e) Applicability dates. This section
applies to CAAs occurring on or after
March 23, 2020. Taxpayers may, how-
ever, choose to apply this section before
the date this section is applicable provid-
ed that they (along with any persons that
are related (within the meaning of section
267(b) or 707(b)) to the taxpayer)—
(1) Consistently apply this section,
§1.704-1(b)(4)(viii)(c)(4)(v) through (vii),
§1.901(m)-1, and §§1.901(m)-3 through
1.901(m)-7 (excluding §1.901(m)-4(e)) to
all CAAs occurring on or after January 1,
2011, and consistently apply §1.901(m)-2
(excluding §1.901(m)-2(d)) to all CAAs
occurring on or after December 7, 2016,
on any original or amended tax return for
each taxable year for which the applica-
tion of the provisions listed in this para-
graph (e)(1) affects the tax liability and
for which the statute of limitations does
not preclude assessment or the filing of a
claim for refund, as applicable;
(2) File all tax returns described in
paragraph (e)(1) of this section for any
taxable year ending on or before March
23, 2020, no later than March 23, 2021;
and
(3) Make appropriate adjustments to
take into account deficiencies that would
have resulted from the consistent applica-
tion under paragraph (e)(2) of this section
for taxable years that are not open for as-
sessment.
§1.901(m)-8T [Removed]
Par. 18. Section 1.901(m)-8T is re-
moved.
Sunita Lough
Deputy Commissioner for
Services and Enforcement
Approved: February 13, 2020
David J. Kautter
Assistant Secretary of
the Treasury (Tax Policy).
(Filed by the Office of the Federal Register on March
20, 2020, 8:45 a.m., and published in the issue of the
Federal Register for March 23, 2020, 85 F.R. 16245)

April 6, 2020 590 Bulletin No. 2020–15
Part III
Relief for Taxpayers
Affected by Ongoing
Coronavirus Disease 2019
Pandemic
Notice 2020-17
I. PURPOSE
On March 13, 2020, the President of
the United States issued an emergency
declaration under the Robert T. Stafford
Disaster Relief and Emergency Assistance
Act in response to the ongoing Coronavi-
rus Disease 2019 (COVID-19) pandemic
(Emergency Declaration). The Emergen-
cy Declaration instructed the Secretary of
the Treasury “to provide relief from tax
deadlines to Americans who have been
adversely affected by the COVID-19
emergency, as appropriate, pursuant to 26
U.S.C. 7508A(a).” Pursuant to the Emer-
gency Declaration, this notice provides re-
lief under section 7508A(a) of the Internal
Revenue Code for the persons described
in section III of this notice that the Sec-
retary of the Treasury has determined to
be affected by the COVID-19 emergency.
II. BACKGROUND
Section 7508A provides the Secretary
of the Treasury or his delegate (Secre-
tary) with authority to postpone the time
for performing certain acts under the in-
ternal revenue laws for a taxpayer deter-
mined by the Secretary to be affected by
a Federally declared disaster as defined in
section 165(i)(5)(A). Pursuant to section
7508A(a), a period of up to one year may
be disregarded in determining whether the
performance of certain acts is timely un-
der the internal revenue laws.
III. GRANT OF RELIEF
The Secretary has determined that any
person with a Federal income tax pay-
ment due April 15, 2020, is affected by the
COVID-19 emergency for purposes of the
relief described in this section III (Affect-
ed Taxpayer).
For an Affected Taxpayer, the due
date for making Federal income tax pay-
ments due April 15, 2020, in an aggregate
amount up to the Applicable Postponed
Payment Amount, is postponed to July 15,
2020. The Applicable Postponed Payment
Amount is up to $10,000,000 for each con-
solidated group (as defined in §1.1502-1)
or for each C corporation that does not
join in filing a consolidated return. For
all other Affected Taxpayers, the Appli-
cable Postponed Payment Amount is up
to $1,000,000 regardless of filing status.
For example, the Applicable Postponed
Payment Amount is the same for a single
individual and for married individuals
filing a joint return. In both instances the
Applicable Postponed Payment Amount is
up to $1,000,000.
The relief provided in this section III
is available solely with respect to Federal
income tax payments (including payments
of tax on self-employment income) due on
April 15, 2020, in respect of an Affected
Taxpayer’s 2019 taxable year, and Federal
estimated income tax payments (includ-
ing payments of tax on self-employment
income) due on April 15, 2020, for an Af-
fected Taxpayer’s 2020 taxable year. The
Applicable Postponed Payment Amounts
described in this section III include, in the
aggregate, all payments described in the
preceding sentence due on April 15, 2020
for such Affected Taxpayers.
No extension is provided in this notice
for the payment or deposit of any other
type of Federal tax, or for the filing of any
tax return or information return.
As a result of the postponement of the
due date for making Federal income tax
payments up to the Applicable Postponed
Payment Amount from April 15, 2020, to
July 15, 2020, the period beginning on
April 15, 2020, and ending on July 15,
2020, will be disregarded in the calcula-
tion of any interest, penalty, or addition to
tax for failure to pay the Federal income
taxes postponed by this notice. Interest,
penalties, and additions to tax with respect
to such postponed Federal income tax
payments will begin to accrue on July 16,
2020. In addition, interest, penalties and
additions to tax will accrue, without any
suspension or deferral, on the amount of
any Federal income tax payments in ex-
cess of the Applicable Postponed Payment
Amount due but not paid by an Affected
Taxpayer on April 15, 2020.
Affected Taxpayers subject to penalties
or additions to tax despite the relief grant-
ed by this section III may seek reasonable
cause relief under section 6651 for a fail-
ure to pay tax or seek a waiver to a pen-
alty under section 6654 for a failure by an
individual or certain trusts and estates to
pay estimated income tax, as applicable.
Similar relief with respect to estimated tax
payments is not available for corporate
taxpayers or tax-exempt organizations un-
der section 6655.
IV. DRAFTING INFORMATION
The principal author of this notice is
Jennifer Auchterlonie of the Office of
Associate Chief Counsel, Procedure and
Administration. For further information
regarding this notice, you may call (202)
317-3400 (not a toll-free number).

Relief for Taxpayers
Affected by Ongoing
Coronavirus Disease 2019
Pandemic
Notice 2020-18
I. PURPOSE
On March 13, 2020, the President of
the United States issued an emergency
declaration under the Robert T. Stafford
Disaster Relief and Emergency Assistance
Act in response to the ongoing Coronavi-
rus Disease 2019 (COVID-19) pandemic
(Emergency Declaration). The Emergen-
cy Declaration instructed the Secretary of
the Treasury “to provide relief from tax
deadlines to Americans who have been
adversely affected by the COVID-19
emergency, as appropriate, pursuant to 26
U.S.C. 7508A(a).” Pursuant to the Emer-
gency Declaration, this notice provides
relief under section 7508A(a) of the Inter-
nal Revenue Code (Code) for the persons

Bulletin No. 2020–15 591 April 6, 2020
described in section III of this notice that
the Secretary of the Treasury has deter-
mined to be affected by the COVID-19
emergency. This notice supersedes Notice
2020-17.
II. BACKGROUND
Section 7508A provides the Secretary
of the Treasury or his delegate (Secre-
tary) with authority to postpone the time
for performing certain acts under the in-
ternal revenue laws for a taxpayer deter-
mined by the Secretary to be affected by
a Federally declared disaster as defined in
section 165(i)(5)(A). Pursuant to section
7508A(a), a period of up to one year may
be disregarded in determining whether the
performance of certain acts is timely un-
der the internal revenue laws.
On March 18, 2020, the Department
of the Treasury and the Internal Revenue
Service issued Notice 2020-17 providing
relief under section 7508A(a) of the Code,
which postponed the due date for certain
Federal income tax payments from April
15, 2020 until July 15, 2020. This notice
restates and expands upon the relief pro-
vided in Notice 2020-17.
III. GRANT OF RELIEF
The Secretary of the Treasury has de-
termined that any person with a Federal
income tax payment or a Federal income
tax return due April 15, 2020, is affected
by the COVID-19 emergency for purpos-
es of the relief described in this section III
(Affected Taxpayer). The term “person”
includes an individual, a trust, estate, part-
nership, association, company or corpora-
tion, as provided in section 7701(a)(1) of
the Code.
For an Affected Taxpayer, the due date
for filing Federal income tax returns and
making Federal income tax payments due
April 15, 2020, is automatically postponed
to July 15, 2020. Affected Taxpayers do
not have to file Forms 4868 or 7004. There
is no limitation on the amount of the pay-
ment that may be postponed.
The relief provided in this section III
is available solely with respect to Federal
income tax payments (including payments
of tax on self-employment income) and
Federal income tax returns due on April
15, 2020, in respect of an Affected Tax-
payer’s 2019 taxable year, and Federal
estimated income tax payments (includ-
ing payments of tax on self-employment
income) due on April 15, 2020, for an Af-
fected Taxpayer’s 2020 taxable year.
No extension is provided in this notice
for the payment or deposit of any other
type of Federal tax, or for the filing of any
Federal information return.
As a result of the postponement of the
due date for filing Federal income tax
returns and making Federal income tax
payments from April 15, 2020, to July 15,
2020, the period beginning on April 15,
2020, and ending on July 15, 2020, will
be disregarded in the calculation of any
interest, penalty, or addition to tax for fail-
ure to file the Federal income tax returns
or to pay the Federal income taxes post-
poned by this notice. Interest, penalties,
and additions to tax with respect to such
postponed Federal income tax filings and
payments will begin to accrue on July 16,
2020.
IV. EFFECT ON OTHER DOCUMENTS
This Notice supersedes Notice 2020-
17. Because of the expansion of relief
provided in this notice and the fact that
Notice 2020-17 is superseded, any phone
calls regarding Notice 2020-17 that have
not already been returned will not be re-
turned. As noted below, taxpayers with
questions regarding the application of this
notice should contact (202) 317-5436.
V. DRAFTING INFORMATION
The principal author of this notice is
Jennifer Auchterlonie of the Office of
Associate Chief Counsel, Procedure and
Administration. For further information
regarding this notice, you may call (202)
317-5436 (not a toll-free number).

Abusive Foreign Tax Credit
Intermediary Transactions
Notice 2020-19
This notice withdraws Notice 2004-
20, 2004-1 C.B. 608, thereby removing
the identification of transactions that are
the same as, or substantially similar to,
the transaction described in that notice
as “listed transactions” for purposes of
§1.6011-4(b)(2) of the Income Tax Regu-
lations and sections 6111 and 6112 of the
Internal Revenue Code.
BACKGROUND
Notice 2004-20 describes a transac-
tion generally involving four parties: (1)
a person or persons (X) that plans to sell
the stock or assets of (2) a foreign corpo-
ration or group of foreign corporations
(Target) that is not engaged in a U.S. trade
or business, (3) a domestic corporation
that acts as an intermediary (Midco), and
(4) a person or persons (Y) that plans to
purchase the assets of Target. Pursuant to
a prearranged plan, the parties undertake
the following steps. X purports to sell
the stock of Target to Midco. Midco then
makes an election under section 338 to
treat the stock purchase as resulting in a
deemed sale by Target (Old Target) of its
assets and an acquisition of those assets by
a deemed new corporation (New Target),
providing New Target with a stepped-up
basis in the assets. Midco then may cause
New Target to liquidate, either in a liqui-
dation under local law or by making an
election under §301.7701-3 to treat New
Target as a disregarded entity. As a result
of the liquidation (or deemed liquidation),
Midco inherits New Target’s assets with
a stepped-up basis. Shortly thereafter,
pursuant to the prearranged plan, Y pur-
chases all or substantially all of New Tar-
get’s assets. Alternatively, if Midco does
not liquidate New Target (or elect to treat
New Target as a disregarded entity), New
Target pays a dividend to Midco after the
asset sale.
The asset sale to Y generates a taxable
gain for foreign tax purposes (but not for
U.S. tax purposes), and Midco claims a
credit under section 901 with respect to
the foreign income tax imposed on the as-
set sale. If Midco does not liquidate New
Target (or elect to treat New Target as a
disregarded entity), Midco claims a credit
under section 902 (as in effect on Decem-
ber 21, 2017) for the foreign income tax
imposed on the asset sale when New Tar-
get pays a dividend.
Notice 2004-20 alerts taxpayers that,
in appropriate cases, the IRS intends to

April 6, 2020 592 Bulletin No. 2020–15
challenge the purported tax results from
the transaction on a number of grounds.
Notice 2004-20 also identifies transac-
tions that are the same as, or substantial-
ly similar to, the transaction described in
Notice 2004-20 as “listed transactions”
for purposes of the disclosure, registra-
tion, and list maintenance requirements
then in §1.6011-4(b)(2) of the Income Tax
Regulations and §§301.6111-2(b)(2) and
301.6112-1(b)(2) of the Procedure and
Administration Regulations.
1
Section 212 of the Education, Jobs and
Medicaid Assistance Act of 2010, P.L.
111-226, 124 Stat. 2389, added section
901(m) to the Internal Revenue Code, ef-
fective for “covered asset acquisitions” af-
ter December 30, 2010. Section 901(m)(1)
provides that, in the case of a covered as-
set acquisition, the disqualified portion of
any foreign income tax determined with
respect to the income or gain attributable
to the disposition of relevant foreign assets
will not be taken into account in determin-
ing the foreign tax credit allowed under
section 901(a), and in the case of foreign
income tax paid by a foreign corporation,
will not be taken into account for purposes
of section 960.
2
Section 901(m)(2) defines
a covered asset acquisition to include a
qualified stock purchase to which section
338(a) applies. Section 901(m) does not
affect the ability to claim a deduction with
respect to the disqualified portion of any
foreign income tax.
DISCUSSION
The Treasury Department and the IRS
have concluded that these transactions
no longer should be identified as “listed
transactions” for purposes of the disclo-
sure, registration, and list maintenance
requirements currently under §1.6011-
4(b)(2) and sections 6111 and 6112. The
Treasury Department and the IRS believe
that the enactment of section 901(m) has
curtailed the use of these transactions be-
cause it effectively denies the foreign tax
credits claimed by Midco under section
901 or 902 (as in effect on December 21,
2017), as described in Notice 2004-20,
or section 960. Accordingly, transactions
will no longer be identified as “listed
transactions” for purposes of §1.6011-
4(b)(2) and sections 6111 and 6112 solely
because they are the same as, or substan-
tially similar to, the transaction described
in Notice 2004-20. Although a transaction
is no longer a “listed transaction” solely
because the transaction is described in
Notice 2004-20, the transaction may still
otherwise be subject to the requirements
of sections 6011, 6111, and 6112, and the
regulations thereunder.
EFFECT ON OTHER DOCUMENTS
Notice 2004-20 is withdrawn effective
for transactions entered into after April 6,
2020.
DRAFTING INFORMATION
The principal author of this notice is
Jeffrey L. Parry, of the Office of Associate
Chief Counsel (International). For further
information regarding this notice, contact
Mr. Parry at (202) 317-6936 (not a toll-
free number).

26 CFR 601.601: Rules and Regulations
(Also Part 1, §§ 143(e)(2), 6a.103A-2(f)(3), 6a.103A-
2(f)(5).)
Rev. Proc. 2020-18
SECTION 1. PURPOSE
This revenue procedure provides is-
suers of qualified mortgage bonds, as
defined in section 143(a) of the Internal
Revenue Code (Code), and issuers of
mortgage credit certificates, as defined in
section 25(c), with (1) the nationwide av-
erage purchase price for residences locat-
ed in the United States, and (2) average
area purchase price safe harbors for resi-
dences located in statistical areas in each
state, the District of Columbia, Puer-
to Rico, the Northern Mariana Islands,
American Samoa, the Virgin Islands, and
Guam.
SECTION 2. BACKGROUND
.01 Section 103(a) provides that, ex-
cept as provided in section 103(b), gross
income does not include interest on any
state or local bond. Section 103(b)(1) pro-
vides that section 103(a) shall not apply
to any private activity bond that is not a
“qualified bond” within the meaning of
section 141. Section 141(e) provides, in
part, that the term “qualified bond” means
any private activity bond if such bond (1)
is a qualified mortgage bond under section
143, (2) meets the volume cap require-
ments under section 146, and (3) meets
the applicable requirements under section
147.
.02 Section 143(a)(1) provides that the
term “qualified mortgage bond” means a
bond that is issued as part of a qualified
mortgage issue. Section 143(a)(2)(A) pro-
vides that the term “qualified mortgage is-
sue” means an issue of one or more bonds
by a state or political subdivision thereof,
but only if: (i) all proceeds of the issue
(exclusive of issuance costs and a rea-
sonably required reserve) are to be used
to finance owner-occupied residences;
(ii) the issue meets the requirements of
subsections (c), (d), (e), (f), (g), (h), (i),
and (m)(7) of section 143; (iii) the issue
does not meet the private business tests of
paragraphs (1) and (2) of section 141(b);
and (iv) with respect to amounts received
more than 10 years after the date of issu-
ance, repayments of $250,000 or more of
principal on mortgage financing provided
by the issue are used by the close of the
first semiannual period beginning after the
date the prepayment (or complete repay-
ment) is received to redeem bonds that are
part of the issue.
Average Area Purchase Price
.03 Section 143(e)(1) provides that an
issue of bonds meets the purchase price
requirements of section 143(e) if the ac-
quisition cost of each residence financed
by the issue does not exceed 90 percent
of the average area purchase price appli-
cable to such residence. Section 143(e)(5)
1
While the definition of a listed transaction remains in §1.6011-4(b)(2), the regulations under section 6111 and 6112, relating to the disclosure and list maintenance requirements applicable
to material advisors, have been revised and now cross-reference that definition. See §§301.6111-3(c)(2) and 301.6112-1(c)(3).
2
The Tax Cuts and Jobs Act 2017, P.L. 115-97, 131 Stat. 2054 (TCJA), revised section 901(m) to remove a reference to deemed paid foreign taxes under section 902, because section 902 was
repealed under the TCJA, which also modified section 960 accordingly.

Bulletin No. 2020–15 593 April 6, 2020
provides that, in the case of a targeted area
residence (as defined in section 143(j)),
section 143(e)(1) shall be applied by sub-
stituting 110 percent for 90 percent.
.04 Section 143(e)(2) provides that the
term “average area purchase price” means,
with respect to any residence, the average
purchase price of single-family residenc-
es (in the statistical area in which the
residence is located) that were purchased
during the most recent 12-month period
for which sufficient statistical information
is available. Under sections 143(e)(3) and
(4), respectively, separate determinations
are to be made for new and existing resi-
dences, and for two-, three-, and four-fam-
ily residences.
.05 Section 143(e)(2) provides that the
determination of the average area pur-
chase price for a statistical area shall be
made as of the date on which the commit-
ment to provide the financing is made or,
if earlier, the date of the purchase of the
residence.
.06 Section 143(k)(2)(A) provides that
the term “statistical area” means (i) a met-
ropolitan statistical area (MSA), and (ii)
any county (or the portion thereof) that
is not within an MSA. Section 143(k)(2)
(C) further provides that if sufficient re-
cent statistical information with respect to
a county (or portion thereof) is unavail-
able, the Secretary may substitute another
area for which there is sufficient recent
statistical information for such county (or
portion thereof). In the case of any por-
tion of a State which is not within a coun-
ty, section 143(k)(2)(D) provides that the
Secretary may designate as a county any
area that is the equivalent of a county. Sec-
tion 6a.103A-1(b)(4)(i) of the Income Tax
Regulations (issued under section 103A
of the Internal Revenue Code of 1954, the
predecessor of section 143 of the Code)
provides that the term “State” includes a
possession of the United States and the
District of Columbia.
.07 Section 6a.103A-2(f)(5)(i) pro-
vides that an issuer may rely upon the
average area purchase price safe harbors
published by the Department of the Trea-
sury (Treasury Department) for the statis-
tical area in which a residence is located.
Section 6a.103A-2(f)(5)(i) further pro-
vides that an issuer may use an average
area purchase price limitation different
from the published safe harbor if the issu-
er has more accurate and comprehensive
data for the statistical area.
Qualified Mortgage Credit Certificate
Program
.08 Section 25(c) permits a state or po-
litical subdivision to establish a qualified
mortgage credit certificate program. In
general, a qualified mortgage credit cer-
tificate program is a program under which
the issuing authority elects not to issue an
amount of private activity bonds that it
may otherwise issue during the calendar
year under section 146, and in their place,
issues mortgage credit certificates to tax-
payers in connection with the acquisi-
tion of their principal residences. Sec-
tion 25(a)(1) provides, in general, that the
holder of a mortgage credit certificate may
claim a federal income tax credit equal to
the product of the credit rate specified in
the certificate and the interest paid or ac-
crued during the tax year on the remaining
principal of the indebtedness incurred to
acquire the residence. Section 25(c)(2)(A)
(iii)(III) generally provides that residences
acquired in connection with the issuance
of mortgage credit certificates must meet
the purchase price requirements of section
143(e).
Income Limitations for Qualified
Mortgage Bonds and Mortgage Credit
Certificates
.09 Section 143(f) imposes limitations
on the income of mortgagors for whom
financing may be provided by qualified
mortgage bonds. In addition, section
25(c)(2)(A)(iii)(IV) provides that holders
of mortgage credit certificates must meet
the income requirement of section 143(f).
Generally, under sections 143(f)(1) and
25(c)(2)(A)(iii)(IV), the income require-
ment is met only if all owner-financing
under a qualified mortgage bond
and all
mortgage credit certificates issued under a
qualified mortgage credit certificate pro-
gram are provided to mortgagors whose
family income is 115 percent or less of the
applicable median family income. Section
143(f)(5), however, generally provides
for an upward adjustment to the percent-
age limitation in high housing cost areas.
High housing cost areas are defined in
section 143(f)(5)(C) as any statistical area
for which the housing cost/income ratio is
greater than 1.2.
.10 Under section 143(f)(5)(D), the
housing cost/income ratio with respect to
any statistical area is determined by divid-
ing (a) the applicable housing price ratio
for such area by (b) the ratio that the area
median gross income for such area bears
to the median gross income for the United
States. The applicable housing price ratio
is the new housing price ratio (new hous-
ing average area purchase price divided
by the new housing average purchase
price for the United States) or the existing
housing price ratio (existing housing av-
erage area purchase price divided by the
existing housing average purchase price
for the United States), whichever results
in the housing cost/income ratio being
closer to 1.
Average Area and Nationwide Purchase
Price Limitations
.11 Average area purchase price safe
harbors for each state, the District of Co-
lumbia, Puerto Rico, the Northern Mari-
ana Islands, American Samoa, the Virgin
Islands, and Guam were last published in
Rev. Proc. 2019-14, 2019-15 I.R.B. 948.
.12 The nationwide average purchase
price limitation was last published in sec-
tion 4.02 of Rev. Proc. 2019-14. Guidance
with respect to the United States and area
median gross income figures that are to
be used in computing the housing cost/in-
come ratio described in section 143(f)(5)
was last published in Rev. Proc. 2019-21,
2019-21 I.R.B. 1190.
.13 This revenue procedure uses FHA
loan limits for a given statistical area to
calculate the average area purchase price
safe harbor for that area. FHA sets limits
on the dollar value of loans it will insure
based on median home prices and con-
forming loan limits established by the
Federal Home Loan Mortgage Corpora-
tion. In particular, FHA sets an area’s loan
limit at 95 percent of the median home
sales price for the area, subject to certain
floors and caps measured against con-
forming loan limits.
.14 To calculate the average area pur-
chase price safe harbors in this revenue
procedure, the FHA loan limits are ad-
justed to take into account the differenc-
es between average and median purchase

April 6, 2020 594 Bulletin No. 2020–15
prices. Because FHA loan limits do not
differentiate between new and existing
residences, this revenue procedure con-
tains a single average area purchase price
safe harbor for both new and existing res-
idences in a statistical area. The Treasury
Department and the Internal Revenue Ser-
vice (IRS) have determined that FHA loan
limits provide a reasonable basis for deter-
mining average area purchase price safe
harbors. If the Treasury Department and
the IRS become aware of other sources
of average purchase price data, including
data that differentiate between new and
existing residences, consideration will be
given as to whether such data provide a
more accurate method for calculating av-
erage area purchase price safe harbors.
.15 The average area purchase price
safe harbors listed in section 4.01 of this
revenue procedure are based on FHA loan
limits released December 3, 2019. FHA
loan limits are available for statistical ar-
eas in each state, the District of Columbia,
Puerto Rico, the Northern Mariana Islands,
American Samoa, the Virgin Islands, and
Guam. See section 3.03 of this revenue
procedure with respect to FHA loan limits
revised after December 3, 2019.
.16 OMB Bulletin No. 03-04, dated
and effective June 6, 2003, revised the
definitions of the nation’s metropolitan
areas and recognized 49 new metropoli-
tan statistical areas. The OMB bulletin no
longer includes primary metropolitan sta-
tistical areas.
SECTION 3. APPLICATION
Average Area Purchase Price Safe
Harbors
.01 Average area purchase price safe
harbors for statistical areas in each state,
the District of Columbia, Puerto Rico,
the Northern Mariana Islands, American
Samoa, the Virgin Islands, and Guam are
set forth in section 4.01 of this revenue
procedure. Average area purchase price
safe harbors are provided for single-fam-
ily and two to four-family residences. For
each type of residence, section 4.01 of this
revenue procedure contains a single safe
harbor that may be used for both new and
existing residences. Issuers of qualified
mortgage bonds and issuers of mortgage
credit certificates may rely on these safe
harbors to satisfy the requirements of sec-
tions 143(e) and (f). Section 4.01 of this
revenue procedure provides safe harbors
for MSAs and for certain counties and
county equivalents. If no purchase price
safe harbor is available for a statistical
area, the safe harbor for “ALL OTHER
AREAS” may be used for that statistical
area.
.02 If a residence is in an MSA, the safe
harbor applicable to it is the limitation of
that MSA. If an MSA falls in more than
one state, the MSA is listed in section 4.01
of this revenue procedure under each state.
.03 If the FHA revises the FHA loan
limit for any statistical area after Decem-
ber 3, 2019, an issuer of qualified mort-
gage bonds or mortgage credit certificates
may use the revised FHA loan limit for
that statistical area to compute (as provid-
ed in the next sentence) a revised average
area purchase price safe harbor for the sta-
tistical area provided that the issuer main-
tains records evidencing the revised FHA
loan limit. The revised average area pur-
chase price safe harbor for that statistical
area is computed by dividing the revised
FHA loan limit by 1.0135.
.04 If, pursuant to section 6a.103A-
2(f)(5)(i), an issuer uses more accurate
and comprehensive data to determine the
average area purchase price for a statisti-
cal area, the issuer must make separate av-
erage area purchase price determinations
for new and existing residences. More-
over, when computing the average area
purchase price for a statistical area that is
an MSA, as defined in OMB Bulletin No.
03-04, the issuer must make the computa-
tion for the entire applicable MSA. When
computing the average area purchase
price for a statistical area that is not an
MSA, the issuer must make the computa-
tion for the entire statistical area and may
not combine statistical areas. Thus, for ex-
ample, the issuer may not combine two or
more counties.
.05 If an issuer receives a ruling per-
mitting it to rely on an average area pur-
chase price limitation that is higher than
the applicable safe harbor in this revenue
procedure, the issuer may rely on that
higher limitation for the purpose of satis-
fying the requirements of section 143(e)
and (f) for bonds sold, and mortgage cred-
it certificates issued, not more than 30
months following the termination date of
the 12-month period used by the issuer to
compute the limitation.
Nationwide Average Purchase Price
.06 Section 4.02 of this revenue proce-
dure sets forth a single nationwide average
purchase price for purposes of computing
the housing cost/income ratio under sec-
tion 143(f)(5).
.07 Issuers must use the nationwide
average purchase price set forth in sec-
tion 4.02 of this revenue procedure when
computing the housing cost/income ra-
tio under section 143(f)(5) regardless of
whether they are relying on the average
area purchase price safe harbors contained
in this revenue procedure or using more
accurate and comprehensive data to deter-
mine average area purchase prices for new
and existing residences for a statistical
area that are different from the published
safe harbors in this revenue procedure.
.08 If, pursuant to section 6.02 of this
revenue procedure, an issuer relies on the
average area purchase price safe harbors
contained in Rev. Proc. 2019-14, the is-
suer must use the nationwide average
purchase price set forth in section 4.02
of Rev. Proc. 2019-14 in computing the
housing cost/income ratio under section
143(f)(5). Likewise, if, pursuant to section
6.04 of this revenue procedure, an issuer
relies on the nationwide average purchase
price published in Rev. Proc. 2019-14, the
issuer may not rely on the average area
purchase price safe harbors published in
this revenue procedure.
SECTION 4. AVERAGE AREA
AND NATIONWIDE AVERAGE
PURCHASE PRICES
.01 Average area purchase prices for
single-family and two to four-family resi-
dences in MSAs, and for certain counties
and county equivalents are set forth be-
low. The safe harbor for “ALL OTHER
AREAS” (found at the end of the table
below) may be used for a statistical area
that is not listed below.

Bulletin No. 2020–15 595 April 6, 2020
2020 Average Area Purchase Prices for Mortgage Revenue Bonds
County NameState
One-Unit
Limit
Two-Unit
Limit
Three-Unit
Limit
Four-Unit
Limit
ALEUTIANS WESTAK$380,110$486,620$588,197$730,966
ANCHORAGE MUNICAK$406,208$520,019$628,551$781,187
JUNEAU CITY ANDAK$449,325$575,222$695,299$864,067
KETCHIKAN GATEWAK$364,225$466,246$563,629$700,429
KODIAK ISLAND BAK$402,804$515,628$623,322$774,626
MATANUSKA-SUSITAK$406,208$520,019$628,551$781,187
NOME CENSUS AREAK$385,784$493,872$596,978$741,869
NORTH SLOPE BORAK$327,916$419,774$507,439$630,623
PETERSBURG CENSAK$327,916$419,774$507,439$630,623
SITKA CITY ANDAK$479,960$614,442$742,708$923,019
SKAGWAY MUNICIPAK$409,611$524,360$633,830$787,699
WRANGELL CITY AAK$327,916$419,774$507,439$630,623
YAKUTAT CITY ANAK$415,285$531,612$642,611$798,651
COCONINOAZ$357,417$457,563$553,072$687,356
ALAMEDACA$755,386$967,246$1,169,117$1,452,905
ALPINECA$457,267$585,385$707,582$879,360
AMADORCA$350,609$448,831$542,514$674,233
CALAVERASCA$368,764$472,067$570,634$709,161
CONTRA COSTACA$755,386$967,246$1,169,117$1,452,905
EL DORADOCA$561,656$719,028$869,148$1,080,096
HUMBOLDTCA
$340,397$435,758$526,728$654,599
INYOCA$368,764$472,067$570,634$709,161
LOS ANGELESCA$755,386$967,246$1,169,117$1,452,905
MARINCA$755,386$967,246$1,169,117$1,452,905
MENDOCINOCA$403,938$517,108$625,048$776,797
MONOCA$521,943$668,165$807,679$1,003,728
MONTEREYCA$663,775$849,760$1,027,161$1,276,490
NAPACA$754,547$965,939$1,167,612$1,451,079
NEVADACA$479,960$614,442$742,708$923,019
ORANGECA$755,386$967,246$1,169,117$1,452,905
PLACERCA$561,656$719,028$869,148$1,080,096
PLUMASCA$332,455$425,595$514,444$639,355
RIVERSIDECA$436,843$559,238$675,960$840,091
SACRAMENTOCA$561,656$719,028$869,148$1,080,096
SAN BENITOCA$755,386$967,246$1,169,117$1,452,905
SAN BERNARDINOCA$436,843$559,238$675,960$840,091
SAN DIEGOCA$692,141$886,069$1,071,068$1,331,052
SAN FRANCISCOCA$755,386$967,246$1,169,117$1,452,905
SAN JOAQUINCA$442,517$566,490$684,741$850,993
SAN LUIS OBISPOCA$680,795$871,516$1,053,505$1,309,247
SAN MATEOCA$755,386$967,246$1,169,117$1,452,905
SANTA BARBARACA$644,486$825,044$997,315$1,239,392

April 6, 2020 596 Bulletin No. 2020–15
2020 Average Area Purchase Prices for Mortgage Revenue Bonds
County NameState
One-Unit
Limit
Two-Unit
Limit
Three-Unit
Limit
Four-Unit
Limit
SANTA CLARACA$755,386$967,246$1,169,117$1,452,905
SANTA CRUZCA$755,386$967,246$1,169,117$1,452,905
SOLANOCA$499,249$639,108$772,554$960,118
SONOMACA$695,545$890,410$1,076,297$1,337,614
STANISLAUSCA$360,821$461,904$558,350$693,868
SUTTERCA$340,397$435,758$526,728$654,599
VENTURACA$703,488$900,573$1,088,630$1,352,857
YOLOCA$561,656$719,028$869,148$1,080,096
YUBACA$340,397$435,758$526,728$654,599
ADAMSCO$567,329$726,280$877,929$1,091,048
ARAPAHOECO$567,329$726,280$877,929$1,091,048
BOULDERCO$635,408$813,451$983,255$1,221,977
BROOMFIELDCO$567,329$726,280$877,929$1,091,048
CHAFFEECO$364,225$466,246$563,629$700,429
CLEAR CREEKCO$567,329$726,280$877,929$1,091,048
DENVERCO$567,329$726,280$877,929$1,091,048
DOUGLASCO$567,329$726,280$877,929$1,091,048
EAGLECO$755,386$967,246$1,169,117$1,452,905
EL PASOCO$351,744$450,262$544,290$676,404
ELBERTCO$567,329$726,280$877,929$1,091,048
GARFIELDCO
$755,386$967,246$1,169,117$1,452,905
GILPINCO$567,329$726,280$877,929$1,091,048
GRANDCO$467,479$598,458$723,369$898,994
GUNNISONCO$366,494$469,156$567,132$704,820
HINSDALECO$422,093$540,344$653,168$811,724
JEFFERSONCO$567,329$726,280$877,929$1,091,048
LA PLATACO$416,419$533,092$644,387$800,822
LARIMERCO$448,190$573,742$693,523$861,896
MONTROSECO$419,823$537,433$649,666$807,334
OURAYCO$419,823$537,433$649,666$807,334
PARKCO$567,329$726,280$877,929$1,091,048
PITKINCO$755,386$967,246$1,169,117$1,452,905
ROUTTCO$629,735$806,150$974,474$1,211,025
SAN MIGUELCO$755,386$967,246$1,169,117$1,452,905
SUMMITCO$712,565$912,216$1,102,641$1,370,321
TELLERCO$351,744$450,262$544,290$676,404
WELDCO$399,400$511,287$618,043$768,065
FAIRFIELDCT$593,426$759,678$918,284$1,141,219
HARTFORDCT$348,340$445,921$539,012$669,892
LITCHFIELDCT$352,879$451,742$546,066$678,624
MIDDLESEXCT$348,340$445,921$539,012$669,892
TOLLANDCT$348,340$445,921$539,012$669,892

Bulletin No. 2020–15 597 April 6, 2020
2020 Average Area Purchase Prices for Mortgage Revenue Bonds
County NameState
One-Unit
Limit
Two-Unit
Limit
Three-Unit
Limit
Four-Unit
Limit
WINDHAMCT$334,724$428,506$517,947$643,696
DISTRICT OF COLUMBIADC$755,386$967,246$1,169,117$1,452,905
NEW CASTLEDE$402,804$515,628$623,322$774,626
SUSSEXDE$340,397$435,758$526,728$654,599
BAKERFL$368,764$472,067$570,634$709,161
BROWARDFL$368,764$472,067$570,634$709,161
CLAYFL$368,764$472,067$570,634$709,161
COLLIERFL$444,786$569,401$688,293$855,384
DUVALFL$368,764$472,067$570,634$709,161
MARTINFL$346,071$443,010$535,509$665,501
MIAMI-DADEFL$368,764$472,067$570,634$709,161
MONROEFL$544,636$697,223$842,804$1,047,388
NASSAUFL$368,764$472,067$570,634$709,161
OKALOOSAFL$385,784$493,872$596,978$741,869
PALM BEACHFL$368,764$472,067$570,634$709,161
ST. JOHNSFL$368,764$472,067$570,634$709,161
ST. LUCIEFL$346,071$443,010$535,509$665,501
WALTONFL$385,784$493,872$596,978$741,869
BARROWGA$395,996$506,945$612,765$761,553
BARTOWGA$395,996$506,945$612,765$761,553
BUTTSGA
$395,996$506,945$612,765$761,553
CARROLLGA$395,996$506,945$612,765$761,553
CHEROKEEGA$395,996$506,945$612,765$761,553
CLARKEGA$374,437$479,319$579,415$720,064
CLAYTONGA$395,996$506,945$612,765$761,553
COBBGA$395,996$506,945$612,765$761,553
COWETAGA$395,996$506,945$612,765$761,553
DAWSONGA$395,996$506,945$612,765$761,553
DEKALBGA$395,996$506,945$612,765$761,553
DOUGLASGA$395,996$506,945$612,765$761,553
FAYETTEGA$395,996$506,945$612,765$761,553
FORSYTHGA$395,996$506,945$612,765$761,553
FULTONGA$395,996$506,945$612,765$761,553
GREENEGA$508,327$650,751$786,614$977,582
GWINNETTGA$395,996$506,945$612,765$761,553
HARALSONGA$395,996$506,945$612,765$761,553
HEARDGA$395,996$506,945$612,765$761,553
HENRYGA$395,996$506,945$612,765$761,553
JASPERGA$395,996$506,945$612,765$761,553
LAMARGA$395,996$506,945$612,765$761,553
MADISONGA$374,437$479,319$579,415$720,064

April 6, 2020 598 Bulletin No. 2020–15
2020 Average Area Purchase Prices for Mortgage Revenue Bonds
County NameState
One-Unit
Limit
Two-Unit
Limit
Three-Unit
Limit
Four-Unit
Limit
MERIWETHERGA$395,996$506,945$612,765$761,553
MORGANGA$395,996$506,945$612,765$761,553
NEWTONGA$395,996$506,945$612,765$761,553
OCONEEGA$374,437$479,319$579,415$720,064
OGLETHORPEGA$374,437$479,319$579,415$720,064
PAULDINGGA$395,996$506,945$612,765$761,553
PICKENSGA$395,996$506,945$612,765$761,553
PIKEGA$395,996$506,945$612,765$761,553
ROCKDALEGA$395,996$506,945$612,765$761,553
SPALDINGGA$395,996$506,945$612,765$761,553
WALTONGA$395,996$506,945$612,765$761,553
HAWAIIHI$385,784$493,872$596,978$741,869
HONOLULUHI$711,430$910,736$1,100,914$1,368,151
KALAWAOHI$680,795$871,516$1,053,505$1,309,247
KAUAIHI$703,488$900,573$1,088,630$1,352,857
MAUIHI$680,795$871,516$1,053,505$1,309,247
ADAID$361,956$463,335$560,077$696,088
BLAINEID$637,678$816,362$986,758$1,226,318
BOISEID$361,956$463,335$560,077$696,088
CAMASID$637,678$816,362$986,758$1,226,318
CANYONID
$361,956$463,335$560,077$696,088
GEMID$361,956$463,335$560,077$696,088
KOOTENAIID$331,320$424,115$512,668$637,135
OWYHEEID$361,956$463,335$560,077$696,088
TETONID$755,386$967,246$1,169,117$1,452,905
BOONEIL$334,724$428,506$517,947$643,696
COOKIL$363,091$464,815$561,853$698,259
DEKALBIL$363,091$464,815$561,853$698,259
DUPAGEIL$363,091$464,815$561,853$698,259
GRUNDYIL$363,091$464,815$561,853$698,259
KANEIL$363,091$464,815$561,853$698,259
KENDALLIL$363,091$464,815$561,853$698,259
LAKEIL$363,091$464,815$561,853$698,259
MCHENRYIL$363,091$464,815$561,853$698,259
WILLIL$363,091$464,815$561,853$698,259
WINNEBAGOIL$334,724$428,506$517,947$643,696
BOONEIN$350,609$448,831$542,514$674,233
BROWNIN$350,609$448,831$542,514$674,233
CLARKIN$329,051$421,254$509,165$632,794
FLOYDIN$329,051$421,254$509,165$632,794
HAMILTONIN$350,609$448,831$542,514$674,233

Bulletin No. 2020–15 599 April 6, 2020
2020 Average Area Purchase Prices for Mortgage Revenue Bonds
County NameState
One-Unit
Limit
Two-Unit
Limit
Three-Unit
Limit
Four-Unit
Limit
HANCOCKIN$350,609$448,831$542,514$674,233
HARRISONIN$329,051$421,254$509,165$632,794
HENDRICKSIN$350,609$448,831$542,514$674,233
JASPERIN$363,091$464,815$561,853$698,259
JOHNSONIN$350,609$448,831$542,514$674,233
LAKEIN$363,091$464,815$561,853$698,259
MADISONIN$350,609$448,831$542,514$674,233
MARIONIN$350,609$448,831$542,514$674,233
MORGANIN$350,609$448,831$542,514$674,233
NEWTONIN$363,091$464,815$561,853$698,259
PORTERIN$363,091$464,815$561,853$698,259
PUTNAMIN$350,609$448,831$542,514$674,233
SHELBYIN$350,609$448,831$542,514$674,233
WASHINGTONIN$329,051$421,254$509,165$632,794
JOHNSONKS$347,205$444,490$537,285$667,721
LEAVENWORTHKS$347,205$444,490$537,285$667,721
LINNKS$347,205$444,490$537,285$667,721
MIAMIKS$347,205$444,490$537,285$667,721
WYANDOTTEKS$347,205$444,490$537,285$667,721
BULLITTKY$329,051$421,254$509,165$632,794
HENRYKY
$329,051$421,254$509,165$632,794
JEFFERSONKY$329,051$421,254$509,165$632,794
OLDHAMKY$329,051$421,254$509,165$632,794
SHELBYKY$329,051$421,254$509,165$632,794
SPENCERKY$329,051$421,254$509,165$632,794
BARNSTABLEMA$465,210$595,547$719,866$894,653
BRISTOLMA$453,863$580,994$702,304$872,799
DUKESMA$755,386$967,246$1,169,117$1,452,905
ESSEXMA$680,795$871,516$1,053,505$1,309,247
MIDDLESEXMA$680,795$871,516$1,053,505$1,309,247
NANTUCKETMA$755,386$967,246$1,169,117$1,452,905
NORFOLKMA$680,795$871,516$1,053,505$1,309,247
PLYMOUTHMA$680,795$871,516$1,053,505$1,309,247
SUFFOLKMA$680,795$871,516$1,053,505$1,309,247
WORCESTERMA$334,724$428,506$517,947$643,696
ANNE ARUNDELMD$514,000$658,003$795,395$988,484
BALTIMOREMD$514,000$658,003$795,395$988,484
BALTIMORE CITYMD$514,000$658,003$795,395$988,484
CALVERTMD$755,386$967,246$1,169,117$1,452,905
CARROLLMD$514,000$658,003$795,395$988,484
CECILMD$402,804$515,628$623,322$774,626

April 6, 2020 600 Bulletin No. 2020–15
2020 Average Area Purchase Prices for Mortgage Revenue Bonds
County NameState
One-Unit
Limit
Two-Unit
Limit
Three-Unit
Limit
Four-Unit
Limit
CHARLESMD$755,386$967,246$1,169,117$1,452,905
FREDERICKMD$755,386$967,246$1,169,117$1,452,905
HARFORDMD$514,000$658,003$795,395$988,484
HOWARDMD$514,000$658,003$795,395$988,484
MONTGOMERYMD$755,386$967,246$1,169,117$1,452,905
PRINCE GEORGE'SMD$755,386$967,246$1,169,117$1,452,905
QUEEN ANNE'SMD$514,000$658,003$795,395$988,484
SOMERSETMD$340,397$435,758$526,728$654,599
ST. MARY'SMD$342,667$438,669$530,231$658,990
TALBOTMD$377,841$483,710$584,694$726,625
WICOMICOMD$340,397$435,758$526,728$654,599
WORCESTERMD$340,397$435,758$526,728$654,599
CUMBERLANDME$361,956$463,335$560,077$696,088
SAGADAHOCME$361,956$463,335$560,077$696,088
YORKME$361,956$463,335$560,077$696,088
ANOKAMN$377,841$483,710$584,694$726,625
CARVERMN$377,841$483,710$584,694$726,625
CHISAGOMN$377,841$483,710$584,694$726,625
DAKOTAMN$377,841$483,710$584,694$726,625
HENNEPINMN$377,841$483,710$584,694$726,625
ISANTIMN
$377,841$483,710$584,694$726,625
LE SUEURMN$377,841$483,710$584,694$726,625
MILLE LACSMN$377,841$483,710$584,694$726,625
RAMSEYMN$377,841$483,710$584,694$726,625
SCOTTMN$377,841$483,710$584,694$726,625
SHERBURNEMN$377,841$483,710$584,694$726,625
WASHINGTONMN$377,841$483,710$584,694$726,625
WRIGHTMN$377,841$483,710$584,694$726,625
BATESMO$347,205$444,490$537,285$667,721
CALDWELLMO$347,205$444,490$537,285$667,721
CASSMO$347,205$444,490$537,285$667,721
CLAYMO$347,205$444,490$537,285$667,721
CLINTONMO$347,205$444,490$537,285$667,721
JACKSONMO$347,205$444,490$537,285$667,721
LAFAYETTEMO$347,205$444,490$537,285$667,721
PLATTEMO$347,205$444,490$537,285$667,721
R AYMO$347,205$444,490$537,285$667,721
CAMDENNC$452,728$579,563$700,577$870,628
CHATHAMNC$408,477$522,929$632,103$785,529
CURRITUCKNC$452,728$579,563$700,577$870,628
DARENC$385,784$493,872$596,978$741,869

Bulletin No. 2020–15 601 April 6, 2020
2020 Average Area Purchase Prices for Mortgage Revenue Bonds
County NameState
One-Unit
Limit
Two-Unit
Limit
Three-Unit
Limit
Four-Unit
Limit
DURHAMNC$408,477$522,929$632,103$785,529
FRANKLINNC$348,340$445,921$539,012$669,892
GATESNC$452,728$579,563$700,577$870,628
GRANVILLENC$408,477$522,929$632,103$785,529
HYDENC$476,556$610,051$737,429$916,458
JOHNSTONNC$348,340$445,921$539,012$669,892
ORANGENC$408,477$522,929$632,103$785,529
PASQUOTANKNC$755,386$967,246$1,169,117$1,452,905
PERQUIMANSNC$755,386$967,246$1,169,117$1,452,905
PERSONNC$408,477$522,929$632,103$785,529
WAKENC$348,340$445,921$539,012$669,892
BILLINGSND$334,724$428,506$517,947$643,696
STARKND$334,724$428,506$517,947$643,696
LINCOLNNE$427,766$547,596$661,950$822,627
LOGANNE$427,766$547,596$661,950$822,627
MCPHERSONNE$427,766$547,596$661,950$822,627
HILLSBOROUGHNH$334,724$428,506$517,947$643,696
ROCKINGHAMNH$680,795$871,516$1,053,505$1,309,247
STRAFFORDNH$680,795$871,516$1,053,505$1,309,247
BERGENNJ$755,386$967,246$1,169,117$1,452,905
BURLINGTONNJ
$402,804$515,628$623,322$774,626
CAMDENNJ$402,804$515,628$623,322$774,626
CAPE MAYNJ$408,477$522,929$632,103$785,529
ESSEXNJ$755,386$967,246$1,169,117$1,452,905
GLOUCESTERNJ$402,804$515,628$623,322$774,626
HUDSONNJ$755,386$967,246$1,169,117$1,452,905
HUNTERDONNJ$755,386$967,246$1,169,117$1,452,905
MERCERNJ$340,397$435,758$526,728$654,599
MIDDLESEXNJ$755,386$967,246$1,169,117$1,452,905
MONMOUTHNJ$755,386$967,246$1,169,117$1,452,905
MORRISNJ$755,386$967,246$1,169,117$1,452,905
OCEANNJ$755,386$967,246$1,169,117$1,452,905
PASSAICNJ$755,386$967,246$1,169,117$1,452,905
SALEMNJ$402,804$515,628$623,322$774,626
SOMERSETNJ$755,386$967,246$1,169,117$1,452,905
SUSSEXNJ$755,386$967,246$1,169,117$1,452,905
UNIONNJ$755,386$967,246$1,169,117$1,452,905
WARRENNJ$367,629$470,636$568,858$706,990
CATRONNM$395,996$506,945$612,765$761,553
LOS ALAMOSNM$425,497$544,685$658,447$818,286

April 6, 2020 602 Bulletin No. 2020–15
2020 Average Area Purchase Prices for Mortgage Revenue Bonds
County NameState
One-Unit
Limit
Two-Unit
Limit
Three-Unit
Limit
Four-Unit
Limit
SANTA FENM$375,572$480,799$581,142$722,234
CARSON CITYNV$356,283$456,083$551,296$685,136
CLARKNV$340,397$435,758$526,728$654,599
DOUGLASNV$453,863$580,994$702,304$872,799
STOREYNV$431,170$551,986$667,179$829,188
WASHOENV$431,170$551,986$667,179$829,188
BRONXNY$755,386$967,246$1,169,117$1,452,905
DUTCHESSNY$351,744$450,262$544,290$676,404
KINGSNY$755,386$967,246$1,169,117$1,452,905
NASSAUNY$755,386$967,246$1,169,117$1,452,905
NEW YORKNY$755,386$967,246$1,169,117$1,452,905
ORANGENY$351,744$450,262$544,290$676,404
PUTNAMNY$755,386$967,246$1,169,117$1,452,905
QUEENSNY$755,386$967,246$1,169,117$1,452,905
RICHMONDNY$755,386$967,246$1,169,117$1,452,905
ROCKLANDNY$755,386$967,246$1,169,117$1,452,905
SUFFOLKNY$755,386$967,246$1,169,117$1,452,905
WESTCHESTERNY$755,386$967,246$1,169,117$1,452,905
DELAWAREOH$368,764$472,067$570,634$709,161
FAIRFIELDOH$368,764$472,067$570,634$709,161
FRANKLINOH
$368,764$472,067$570,634$709,161
HOCKINGOH$368,764$472,067$570,634$709,161
LICKINGOH$368,764$472,067$570,634$709,161
MADISONOH$368,764$472,067$570,634$709,161
MORROWOH$368,764$472,067$570,634$709,161
PERRYOH$368,764$472,067$570,634$709,161
PICKAWAYOH$368,764$472,067$570,634$709,161
UNIONOH$368,764$472,067$570,634$709,161
BENTONOR$397,130$508,376$614,541$763,723
CLACKAMASOR$484,499$620,214$749,713$931,751
CLATSOPOR$340,397$435,758$526,728$654,599
COLUMBIAOR$484,499$620,214$749,713$931,751
DESCHUTESOR$425,497$544,685$658,447$818,286
HOOD RIVEROR$470,883$602,799$728,648$905,556
JACKSONOR$329,051$421,254$509,165$632,794
MARIONOR$338,128$432,847$523,225$650,258
MULTNOMAHOR$484,499$620,214$749,713$931,751
POLKOR$338,128$432,847$523,225$650,258
WASHINGTONOR$484,499$620,214$749,713$931,751
YAMHILLOR$484,499$620,214$749,713$931,751

Bulletin No. 2020–15 603 April 6, 2020
2020 Average Area Purchase Prices for Mortgage Revenue Bonds
County NameState
One-Unit
Limit
Two-Unit
Limit
Three-Unit
Limit
Four-Unit
Limit
BUCKSPA$402,804$515,628$623,322$774,626
CARBONPA$367,629$470,636$568,858$706,990
CHESTERPA$402,804$515,628$623,322$774,626
DELAWAREPA$402,804$515,628$623,322$774,626
LEHIGHPA$367,629$470,636$568,858$706,990
MONTGOMERYPA$402,804$515,628$623,322$774,626
NORTHAMPTONPA$367,629$470,636$568,858$706,990
PHILADELPHIAPA$402,804$515,628$623,322$774,626
PIKEPA$755,386$967,246$1,169,117$1,452,905
BRISTOLRI$453,863$580,994$702,304$872,799
KENTRI$453,863$580,994$702,304$872,799
NEWPORTRI$453,863$580,994$702,304$872,799
PROVIDENCERI$453,863$580,994$702,304$872,799
WASHINGTONRI$453,863$580,994$702,304$872,799
BEAUFORTSC$346,071$443,010$535,509$665,501
BERKELEYSC$385,784$493,872$596,978$741,869
CHARLESTONSC$385,784$493,872$596,978$741,869
DORCHESTERSC$385,784$493,872$596,978$741,869
JASPERSC$346,071$443,010$535,509$665,501
CANNONTN$555,982$711,776$860,367$1,069,193
CHEATHAMTN
$555,982$711,776$860,367$1,069,193
DAVIDSONTN$555,982$711,776$860,367$1,069,193
DICKSONTN$555,982$711,776$860,367$1,069,193
MACONTN$555,982$711,776$860,367$1,069,193
MAURYTN$555,982$711,776$860,367$1,069,193
ROBERTSONTN$555,982$711,776$860,367$1,069,193
RUTHERFORDTN$555,982$711,776$860,367$1,069,193
SMITHTN$555,982$711,776$860,367$1,069,193
SUMNERTN$555,982$711,776$860,367$1,069,193
TROUSDALETN$555,982$711,776$860,367$1,069,193
WILLIAMSONTN$555,982$711,776$860,367$1,069,193
WILSONTN$555,982$711,776$860,367$1,069,193
ATASCOSATX$388,053$496,783$600,481$746,260
BANDERATX$388,053$496,783$600,481$746,260
BASTROPTX$399,400$511,287$618,043$768,065
BEXARTX$388,053$496,783$600,481$746,260
CALDWELLTX$399,400$511,287$618,043$768,065
COLLINTX$399,400$511,287$618,043$768,065
COMALTX$388,053$496,783$600,481$746,260
DALLASTX$399,400$511,287$618,043$768,065
DENTONTX$399,400$511,287$618,043$768,065

April 6, 2020 604 Bulletin No. 2020–15
2020 Average Area Purchase Prices for Mortgage Revenue Bonds
County NameState
One-Unit
Limit
Two-Unit
Limit
Three-Unit
Limit
Four-Unit
Limit
ELLISTX$399,400$511,287$618,043$768,065
GUADALUPETX$388,053$496,783$600,481$746,260
HAYSTX$399,400$511,287$618,043$768,065
HUNTTX$399,400$511,287$618,043$768,065
JOHNSONTX$399,400$511,287$618,043$768,065
KAUFMANTX$399,400$511,287$618,043$768,065
KENDALLTX$388,053$496,783$600,481$746,260
MARTINTX$336,993$431,417$521,449$648,038
MEDINATX$388,053$496,783$600,481$746,260
MIDLANDTX$336,993$431,417$521,449$648,038
PARKERTX$399,400$511,287$618,043$768,065
ROCKWALLTX$399,400$511,287$618,043$768,065
TARRANTTX$399,400$511,287$618,043$768,065
TRAVISTX$399,400$511,287$618,043$768,065
WILLIAMSONTX$399,400$511,287$618,043$768,065
WILSONTX$388,053$496,783$600,481$746,260
WISETX$399,400$511,287$618,043$768,065
BOX ELDERUT$637,678$816,362$986,758$1,226,318
DAVISUT$637,678$816,362$986,758$1,226,318
JUABUT$395,996$506,945$612,765$761,553
MORGANUT
$637,678$816,362$986,758$1,226,318
RICHUT$369,898$473,547$572,410$711,332
SALT LAKEUT$410,746$525,840$635,606$789,919
SUMMITUT$755,386$967,246$1,169,117$1,452,905
TOOELEUT$410,746$525,840$635,606$789,919
UTAHUT$395,996$506,945$612,765$761,553
WASATCHUT$755,386$967,246$1,169,117$1,452,905
WASHINGTONUT$372,168$476,408$575,913$715,722
WEBERUT$637,678$816,362$986,758$1,226,318
ALBEMARLEVA$431,170$551,986$667,179$829,188
ALEXANDRIA CITYVA$755,386$967,246$1,169,117$1,452,905
AMELIAVA$528,751$676,897$818,187$1,016,851
ARLINGTONVA$755,386$967,246$1,169,117$1,452,905
CHARLES CITYVA$528,751$676,897$818,187$1,016,851
CHARLOTTESVILLEVA$431,170$551,986$667,179$829,188
CHESAPEAKE CITYVA$452,728$579,563$700,577$870,628
CHESTERFIELDVA$528,751$676,897$818,187$1,016,851
CLARKEVA$755,386$967,246$1,169,117$1,452,905
COLONIAL HEIGHTVA$528,751$676,897$818,187$1,016,851
CULPEPERVA$755,386$967,246$1,169,117$1,452,905
DINWIDDIEVA$528,751$676,897$818,187$1,016,851
FAIRFAXVA$755,386$967,246$1,169,117$1,452,905

Bulletin No. 2020–15 605 April 6, 2020
2020 Average Area Purchase Prices for Mortgage Revenue Bonds
County NameState
One-Unit
Limit
Two-Unit
Limit
Three-Unit
Limit
Four-Unit
Limit
FAIRFAX CITYVA$755,386$967,246$1,169,117$1,452,905
FALLS CHURCH CIVA$755,386$967,246$1,169,117$1,452,905
FAUQUIERVA$755,386$967,246$1,169,117$1,452,905
FLUVANNAVA$431,170$551,986$667,179$829,188
FRANKLIN CITYVA$452,728$579,563$700,577$870,628
FREDERICKSBURGVA$755,386$967,246$1,169,117$1,452,905
GLOUCESTERVA$452,728$579,563$700,577$870,628
GOOCHLANDVA$528,751$676,897$818,187$1,016,851
GREENEVA$431,170$551,986$667,179$829,188
HAMPTON CITYVA$452,728$579,563$700,577$870,628
HANOVERVA$528,751$676,897$818,187$1,016,851
HENRICOVA$528,751$676,897$818,187$1,016,851
HOPEWELL CITYVA$528,751$676,897$818,187$1,016,851
ISLE OF WIGHTVA$452,728$579,563$700,577$870,628
JAMES CITYVA$452,728$579,563$700,577$870,628
KING AND QUEENVA$528,751$676,897$818,187$1,016,851
KING GEORGEVA$346,071$443,010$535,509$665,501
KING WILLIAMVA$528,751$676,897$818,187$1,016,851
LANCASTERVA$436,843$559,238$675,960$840,091
LEXINGTON CITYVA$349,475$447,401$540,788$672,063
LOUDOUNVA
$755,386$967,246$1,169,117$1,452,905
MADISONVA$755,386$967,246$1,169,117$1,452,905
MANASSAS CITYVA$755,386$967,246$1,169,117$1,452,905
MANASSAS PARK CVA$755,386$967,246$1,169,117$1,452,905
MATHEWSVA$452,728$579,563$700,577$870,628
NELSONVA$431,170$551,986$667,179$829,188
NEW KENTVA$528,751$676,897$818,187$1,016,851
NEWPORT NEWS CIVA$452,728$579,563$700,577$870,628
NORFOLK CITYVA$452,728$579,563$700,577$870,628
PETERSBURG CITYVA$528,751$676,897$818,187$1,016,851
POQUOSON CITYVA$452,728$579,563$700,577$870,628
PORTSMOUTH CITYVA$452,728$579,563$700,577$870,628
POWHATANVA$528,751$676,897$818,187$1,016,851
PRINCE GEORGEVA$528,751$676,897$818,187$1,016,851
PRINCE WILLIAMVA$755,386$967,246$1,169,117$1,452,905
RAPPAHANNOCKVA$755,386$967,246$1,169,117$1,452,905
RICHMOND CITYVA$528,751$676,897$818,187$1,016,851
SOUTHAMPTONVA$452,728$579,563$700,577$870,628
SPOTSYLVANIAVA$755,386$967,246$1,169,117$1,452,905
STAFFORDVA$755,386$967,246$1,169,117$1,452,905
SUFFOLK CITYVA$452,728$579,563$700,577$870,628
SUSSEXVA$528,751$676,897$818,187$1,016,851
VIRGINIA BEACHVA$452,728$579,563
$700,577$870,628

April 6, 2020 606 Bulletin No. 2020–15
2020 Average Area Purchase Prices for Mortgage Revenue Bonds
County NameState
One-Unit
Limit
Two-Unit
Limit
Three-Unit
Limit
Four-Unit
Limit
WARRENVA$755,386$967,246$1,169,117$1,452,905
WILLIAMSBURG CIVA$452,728$579,563$700,577$870,628
YORKVA$452,728$579,563$700,577$870,628
CHITTENDENVT$363,091$464,815$561,853$698,259
FRANKLINVT$363,091$464,815$561,853$698,259
GRAND ISLEVT$363,091$464,815$561,853$698,259
CHELANWA$340,397$435,758$526,728$654,599
CLALLAMWA$378,976$485,140$586,421$728,796
CLARKWA$484,499$620,214$749,713$931,751
DOUGLASWA$340,397$435,758$526,728$654,599
ISLANDWA$388,053$496,783$600,481$746,260
JEFFERSONWA$347,205$444,490$537,285$667,721
KINGWA$731,854$936,931$1,132,487$1,407,420
KITSAPWA$390,322$499,693$603,983$750,601
PIERCEWA$731,854$936,931$1,132,487$1,407,420
SAN JUANWA$491,307$628,946$760,270$944,825
SKAGITWA$368,764$472,067$570,634$709,161
SKAMANIAWA$484,499$620,214$749,713$931,751
SNOHOMISHWA$731,854$936,931$1,132,487$1,407,420
THURSTONWA$365,360$467,726$565,356$702,600
WHATCOMWA
$406,208$520,019$628,551$781,187
COLUMBIAWI$329,051$421,254$509,165$632,794
DANEWI$329,051$421,254$509,165$632,794
GREENWI$329,051$421,254$509,165$632,794
IOWAWI$329,051$421,254$509,165$632,794
KENOSHAWI$363,091$464,815$561,853$698,259
MILWAUKEEWI$334,724$428,506$517,947$643,696
OZAUKEEWI$334,724$428,506$517,947$643,696
PIERCEWI$377,841$483,710$584,694$726,625
ST. CROIXWI$377,841$483,710$584,694$726,625
WASHINGTONWI$334,724$428,506$517,947$643,696
WAUKESHAWI$334,724$428,506$517,947$643,696
JEFFERSONWV$755,386$967,246$1,169,117$1,452,905
TETONWY$755,386$967,246$1,169,117$1,452,905
GUAMGU$555,982$711,776$860,367$1,069,193
NORTHERN ISLANDMP$517,404$662,344$800,624$994,996
ROTAMP$405,073$518,539$626,824$778,967
SAIPANMP$521,943$668,165$807,679$1,003,728
TINIANMP$525,347$672,556$812,958$1,010,289

Bulletin No. 2020–15 607 April 6, 2020
2020 Average Area Purchase Prices for Mortgage Revenue Bonds
County NameState
One-Unit
Limit
Two-Unit
Limit
Three-Unit
Limit
Four-Unit
Limit
FLATHEADMT$339,263$434,327$525,001$652,428
GALLATINMT$432,305$553,417$668,955$831,359
MISSOULAMT$346,071$443,010$535,509$665,501
PARKMT$332,455$425,595$514,444$639,355
AGUAS BUENASPR$380,110$486,620$588,197$730,966
AIBONITOPR$380,110$486,620$588,197$730,966
BARCELONETAPR$380,110$486,620$588,197$730,966
BARRANQUITASPR$380,110$486,620$588,197$730,966
BAYAMONPR$380,110$486,620$588,197$730,966
CAGUASPR$380,110$486,620$588,197$730,966
CANOVANASPR$380,110$486,620$588,197$730,966
CAROLINAPR$380,110$486,620$588,197$730,966
CATANOPR$380,110$486,620$588,197$730,966
CAYEYPR$380,110$486,620$588,197$730,966
CAYEYPR$380,110$486,620$588,197$730,966
CEIBAPR$380,110$486,620$588,197$730,966
CIALESPR$380,110$486,620$588,197$730,966
CIDRAPR$380,110$486,620$588,197$730,966
COMERIOPR$380,110$486,620$588,197$730,966
COROZALPR$380,110$486,620$588,197$730,966
DORADOPR
$380,110$486,620$588,197$730,966
FAJARDOPR$380,110$486,620$588,197$730,966
FLORIDAPR$380,110$486,620$588,197$730,966
GUAYNABOPR$380,110$486,620$588,197$730,966
GURABOPR$380,110$486,620$588,197$730,966
HUMACAOPR$380,110$486,620$588,197$730,966
JUNCOSPR$380,110$486,620$588,197$730,966
LAS PIEDRASPR$380,110$486,620$588,197$730,966
LOIZAPR$380,110$486,620$588,197$730,966
LUQUILLOPR$380,110$486,620$588,197$730,966
MANATIPR$380,110$486,620$588,197$730,966
MAUNABOPR$380,110$486,620$588,197$730,966
MOROVISPR$380,110$486,620$588,197$730,966
NAGUABOPR$380,110$486,620$588,197$730,966
NARANJITOPR$380,110$486,620$588,197$730,966
OROCOVISPR$380,110$486,620$588,197$730,966
RIO GRANDEPR$380,110$486,620$588,197$730,966
SAN JUANPR$380,110$486,620$588,197$730,966
SAN LORENZOPR$380,110$486,620$588,197$730,966
TOA ALTAPR$380,110$486,620$588,197$730,966
TOA BAJAPR$380,110$486,620$588,197$730,966

April 6, 2020 608 Bulletin No. 2020–15
2020 Average Area Purchase Prices for Mortgage Revenue Bonds
One-Unit Two-Unit Three-Unit Four-Unit
County NameStateLimitLimitLimitLimit
TRUJILLO ALTOPR$380,110$486,620$588,197$730,966
VEGA ALTAPR$380,110$486,620$588,197$730,966
VEGA BAJAPR$380,110$486,620$588,197$730,966
YABUCOAPR$380,110$486,620$588,197$730,966
ST. JOHN ISLANDVI$614,985$787,305$951,633$1,182,659
ST. THOMAS ISLANDVI$440,247$563,580$681,239$846,652
All other areas - 2695 counties $327,334$419,133$506,600$629,587
(floor):
.02 The nationwide average purchase
price (for use in the housing cost/income
ratio for new and existing residences) is
$308,400.
SECTION 5. EFFECT ON OTHER
DOCUMENTS
Rev. Proc. 2019-14 is obsolete except
as provided in section 6 of this revenue
procedure.
SECTION 6. EFFECTIVE DATES
.01 Issuers may rely on this revenue
procedure to determine average area pur-
chase price safe harbors for commitments
to provide financing or issue mortgage
credit certificates that are made, or (if the
purchase precedes the commitment) for
residences that are purchased, in the pe-
riod that begins on March 24, 2020, and
ends on the date as of which the safe har-
bors contained in section 4.01 of this rev-
enue procedure are rendered obsolete by a
new revenue procedure.
.02 Notwithstanding section 5 of this
revenue procedure, issuers may continue
to rely on the average area purchase price
safe harbors contained in Rev. Proc. 2019-
14, with respect to bonds sold, or for mort-
gage credit certificates issued with respect
to bond authority exchanged, before April
23, 2020, if the commitments to provide
financing or issue mortgage credit certifi-
cates are made on or before May 23, 2020.
.03 Except as provided in section 6.04,
issuers must use the nationwide average
purchase price limitation contained in

this revenue procedure for commitments
to provide financing or issue mortgage
credit certificates that are made, or (if the
purchase precedes the commitment) for
residences that are purchased, in the pe-
riod that begins on March 24, 2020, and
ends on the date when the nationwide
average purchase price limitation is ren-
dered obsolete by a new revenue proce-
dure.
.04 Notwithstanding sections 5 and
6.03 of this revenue procedure, issuers
may continue to rely on the nationwide
average purchase price set forth in Rev.
Proc. 2019-14 with respect to bonds sold,
or for mortgage credit certificates issued
with respect to bond authority exchanged,
before April 23, 2020, if the commitments
to provide financing or issue mortgage
credit certificates are made on or before
May 23, 2020.
SECTION 7. PAPERWORK
REDUCTION ACT
The collection of information con-
tained in this revenue procedure has been
reviewed and approved by the Office of
Management and Budget in accordance
with the Paperwork Reduction Act (44
U.S.C. 3507) under control number 1545-
1877.
An agency may not conduct or sponsor,
and a person is not required to respond
to, a collection of information unless the
collection of information displays a valid
OMB control number.
This revenue procedure contains a col-
lection of information requirement in sec-
tion 3.03. The purpose of the collection
of information is to verify the applicable
FHA loan limit that issuers of qualified
mortgage bonds and qualified mortgage
certificates have used to calculate the
average area purchase price for a given
metropolitan statistical area for purposes
of sections 143(e) and 25(c). The collec-
tion of information is required to obtain
the benefit of using revisions to FHA loan
limits to determine average area purchase
prices. The likely respondents are state
and local governments.
The estimated total annual reporting
and/or recordkeeping burden is: 15 hours.
The estimated annual burden per re-
spondent and/or recordkeeper: 15 min-
utes.
The estimated number of respondents
and/or recordkeepers: 60.
Books or records relating to a collec-
tion of information must be retained as
long as their contents may become mate-
rial in the administration of any internal
revenue law. Generally, tax returns and tax
return information are confidential, as re-
quired by 26 U.S.C. 6103.
SECTION 8. DRAFTING
INFORMATION
The principal authors of this revenue
procedure are David White and Timothy
Jones of the Office of Associate Chief
Counsel (Financial Institutions & Prod-
ucts). For further information regarding
this revenue procedure contact David
White on (202) 317-4562 (not a toll-free
number).

Bulletin No. 2020–15 609 April 6, 2020
Part IV
Announcement and Report Concerning Advance Pricing Agreements
Announcement 2020-2
March 25, 2020
This Announcement is issued pursuant to § 521(b) of Pub. L. 106-170, the Ticket to Work and Work Incentives Improvement Act of
1999, which requires the Secretary of the Treasury to report annually to the public concerning advance pricing agreements (APAs)
and the Advance Pricing and Mutual Agreement Program (APMA Program), formerly known as the Advance Pricing Agreement
Program (APA Program). The first report covered calendar years 1991 through 1999. Subsequent reports covered each calendar year
2000 through 2018 separately. This twenty-first report describes the experience, structure, and activities of the APMA Program during
calendar year 2019. It does not provide guidance regarding the application of the arm’s length standard.
Part I of this report includes information on the structure, composition, and operation of the APMA Program; Part II presents statisti-
cal data; and Part III includes general descriptions of various elements of the APAs executed in 2019, including types of transactions
covered, transfer pricing methods used, and completion time.
John C. C. Hughes
Director, Advance Pricing and Mutual Agreement Program

April 6, 2020 610 Bulletin No. 2020–15
Part I. The APMA Program – Structure, Composition, and Operation
[Pub. L. 106-170 § 521(b)(2)(A)]
In February 2012, the former APA Program was moved from the Office of Chief Counsel to the Office of Transfer Pricing Operations
1

within the Large Business and International Division of the IRS and combined with the U.S. Competent Authority staff responsible
for transfer pricing cases, thereby forming the APMA Program.
In September 2018, APMA restructured its management and realigned its teams. As of December 31, 2019, the APMA Program com-
prised 52 team leaders, 16 economists, 6 managers and 3 assistant directors. Each assistant director oversees 2 managers who lead
teams comprised of both team leaders and economists. The APMA Program’s main office is in Washington, DC, and it also has offices
in northern California (San Francisco and San Jose), southern California (Los Angeles and Laguna Niguel), Chicago, and New York.
On August 31, 2015, new revenue procedures governing requests under the mutual agreement procedure (MAP) and APA appli-
cations were published in 2015-35 I.R.B. on pages 236 and 263, respectively. Revenue Procedure (Rev. Proc.) 2015-41 provides
guidance and instructions on filing APA requests as well as guidance and information on the administration of APAs. Rev. Proc.
2015-41 updates and supersedes Rev. Proc. 2006-9, 2006-1 C.B. 278, as modified by Rev. Proc. 2008-31, 2008-1 C.B. 1133, which is
also superseded. Rev. Proc. 2015-40 provides procedures and guidance on requesting assistance from the U.S. Competent Authority
where the taxpayer believes that the actions of the United States or a treaty country result or will result in the taxpayer being subject
to taxation not in accordance with the applicable U.S. tax treaty. Rev. Proc. 2015-40 updates and supersedes Rev. Proc. 2006-54,
2006-2 C.B. 1035.
The 2009 and 2015 Model APAs appear in this report as Appendix 1 and Appendix 2, respectively. The 2015 Model APA was final-
ized in May 2018. The new model does not contain any major revisions from the draft revision that was released for public comment
in the fall of 2017. A list of primary APMA contacts is available at https://www.irs.gov/businesses/corporations/apma-contacts.
1
In 2017, Transfer Pricing Operations became Treaty & Transfer Pricing Operations (TTPO).

Bulletin No. 2020–15 611 April 6, 2020
Part II. APMA Program Statistical Data
[Pub. L. 106-170 § 521(b)(2)(C)(i-viii)]
Table 1: APA Applications Filed
§ 521(b)(2)(C)(i)
UnilateralBilateralMultilateralTotal
Filed 1991-1999
2
401
Filed 2000-20186051,525182,148
Filed in 201917968121
Total Filed 1991-20192,670
Table 1:
§ 521(b)(
Filed 19
Filed 20
Filed in
TotalF
The char
requests
2
The first
of applica
t
APA Appli
(2)(C)(i)
991-1999
2
000-2018
n 2019
Filed 1991-20
rts above illu
received in 2
APA Statutory
tions for those y
0
50
100
150
200
250
S
Part II.
[Pub
ications File
019
ustrate the nu
2019 by fore

y Report, which
years by subm
2010 2011
Kor
7%
France
4%
Germany
4%
Switzerland
4%
All Othe
r
2
APMA P
b. L. 106-17
ed
Unilat
e
umber of com
eign country
h compiled AP
mission type, so
2012 2013
Appl
2
In
1
rea
%
r Countries
23%
Bilat
Filed by
3
Program S
70§ 521(b)(2
eral B
605
17
mplete appli
y. As of Dece
PA data from 1
the cumulativ
2014 2015
ications File
2010-2019
ndia
2%
teral APAs
Country 20
tatisticalD
2)(C)(i-viii)]
Bilateral
1,525
96
cations file
d
ember 31, 20
991-1999, did
ve totals cannot
2016 2017
ed
Japa
32%
Canada
14%
019
Data
]
Multilate
d per year an
019, APMA
not report the
t be reported in
2018 2019
an
%
eral Tota
4
18 2,1
81
2,6
nd the bilater
had also
cumulative nu
n that manner.
al
401
148
121
670
ral
umber
The charts above illustrate the number of complete applications filed per year and the bilateral requests received in 2019 by foreign
country. As of December 31, 2019, APMA had also received 29 user fee filings that were not yet accompanied by substantially com-
plete APA applications, in addition to the 122 complete APA applications.
2
The first APA Statutory Report, which compiled APA data from 1991-1999, did not report the cumulative number of applications for those years by submission type, so the cumulative totals
cannot be reported in that manner.

April 6, 2020 612 Bulletin No. 2020–15
Table 2: Executed and Pending APAs
§ 521(b)(2)(C)(ii-vi)
UnilateralBilateralMultilateral
Total
Total Executed 1991-20186141,189171,820
Total Executed in 201929910120
Total Executed 1991-20196431,280171,940
Total Pending as of 12/31/20194638622454
Renewals Executed in 2019
3
2048068
Renewals Pending
4
281588194
received
applicati
o
Table 2:
§ 521(b)(
Total Ex
Total Ex
TotalE
TotalP
Renewa
Renewa
3
The numb
4
The numb
29 user fee
ons, in addit
Executed a
(2)(C)(ii-vi)
xecuted 199
xecuted in 2
Executed 199
Pending as o
als Executed
als Pending
4
ber of renewal
ber of renewal
0
50
100
150
2
Au
Switzer
4%
All Other Co
17%
filings that w
tion to the 12
and Pending
)
1-2018
019
91-2019
of 12/31/2019
in 2019
3

s executed is i
n
s still pending
01020112
Ko
10
ustralia
9%
rland
ountries
were not yet
22 complete
g APAs
U
n
9
ncluded in the
as of yea
r-end
20122013
APA
20
orea
0%
Bil
Execute
d
4
accompanie
APA applic
nilateral
614
29
643
46
20
28
total number o
d is also include
20142015
As Executed
010-2019
Ca
1
ateral APAs
d by Countr
ed by substan
cations.
Bilateral
1,189
91
1,280
386
48
158
of APAs execu
ed in the total n
20162017
d
Jap
49
anada
1%
s
ry 2019
ntially comp
Multilateral
17
0
17
22
0
8
uted during the
number of pen
20182019
pan
9%
plete APA
l
Total
7 1,82
0 12
7 1,94
2 45
06
8 19
year.
nding APAs.
9
0
0
0
4
68
94
Consistent with prior years, roughly 40 percent of the APAs executed in 2019 were new APAs (i.e., not a renewal of a prior APA).
The charts above illustrate the total number of APAs executed per year and the countries involved in the executed bilateral APAs.
3
The number of renewals executed is included in the total number of APAs executed during the year.
4
The number of renewals still pending as of year-end is also included in the total number of pending APAs.

Bulletin No. 2020–15 613 April 6, 2020
Consisten
(i.e., not
executed
As the t
o
Decembe
requests
nt with prior
a renewal of
d per year and
op chart illus
er 31, 2018.
involved eith
0
100
200
300
400
500
Mexico
5%
All Oth
e
1
r years, roug
f a prior APA
d the countri
trates, the nu
As of Dece
her Japan or
2010 2011
Germany
8%
Korea
5%
UK
4%
Italy
4%
er Countries
15%
ghly 40 perce
A). The char
ies involved
umber of pen
mber 31, 20
r India.
2012 2013
Pen
2
Canada
10%
Bila
Pendingb
5
ent of the AP
rts above illu
d in the execu
nding reques
019, approxim
2014 2015
nding APAs
2010-2019
ateral APAs
by Country
PAs execute
ustrate the to
uted bilatera
sts decreased
mately half o
2016 2017
s
I
2
s
y 2019
d in 2019 w
otal number
al APAs.
d slightly re
of the pendin
2018 2019
Japan
28%
India
21%
were new APA
of APAs
lative to
ng bilateral A
As
APA
As the top chart illustrates, the number of pending requests decreased slightly relative to December 31, 2018. As of December 31,
2019, approximately half of the pending bilateral APA requests involved either Japan or India.
Table 3: APAs Revoked or Cancelled and Applications Withdrawn
§ 521(b)(2)(C)(vii)
UnilateralBilateralMultilateralTotal
Revoked or Cancelled in 20190000
Total Revoked or Cancelled 1991-2019
5
11
Applications Withdrawn in 2019
6
111012
Total Applications Withdrawn 1991-2019
7
265
5
The first APA Statutory Report, which compiled APA data from 1991-1999, did not report the cumulative number of applications for those years by submission type, so the cumulative totals
cannot be reported in that manner.
6
This number does not include bilateral cases where APMA was unable to reach a mutual agreement with the treaty partner(s) involved.
7
The first APA Statutory Report, which compiled APA data from 1991-1999, did not report the cumulative number of applications for those years by submission type, so the cumulative totals
cannot be reported in that manner.

April 6, 2020 614 Bulletin No. 2020–15
Table 4: APAs Executed
8
by Industry
§ 521(b)(2)(C)(viii)
Industry
Wholesale/Retail Trade52
Manufacturing38
Services13
Management11
All Other Industries6
Table 3:
§ 521(b)(
Revoke
TotalR
Applica
TotalA
Table 4:
§ 521(b)(
Wholes
Manuf
a
Services
Manage
All Othe
5
The first
of applica
t
6
This num
partner(s) i
7
The first
of applica
t
8
APAs exe
APAs Revo
(2)(C)(vii)
d or Cancel
l
Revoked or C
ations Withd
Applications
APAs Exec
(2)(C)(viii)
ale/Retail T
r
acturing
s
ement
er Industries
APA Statutory
tions for those y
mber does not in
involved.
APA Statutor
y
tions for those y
ecuted include
Who
oked or Can
led in 2019
Cancelled 1
drawn in 201
s Withdrawn
cuted
8
by In
Industry
rade
s

y Report, which
years by subm
nclude bilatera
y Report, which
years by subm
APAs that we
olesale/Retail
Trade
43%
All
O
ncelled and
991-2019
5
9
6
n 1991-2019
ndustry
h compiled AP
mission type, so
al cases where A
h compiled AP
mission type, so
ere renewed.
Other Industries
5%
APA
Finalize
6
Application
Unilater
9
7
PA data from 1
the cumulativ
APMA was un
PA data from 1
the cumulativ
Manageme
9%
s
As by Indus
d or Renew
ns Withdraw
ralBilatera
0
11
52
38
13
11
6
991-1999, did
ve totals cannot
nable to reach a
991-1999, did
ve totals cannot
Ser
1
ent
stry
wed 2019
wn
alMultilate
0
1
not report the
t be reported in
a mutual agreem
not report the
t be reported in
Man
rvices
1%
eral
Tot
a
0
0
2
cumulative nu
n that manner.
ment with the
cumulative n
u
n that manner.
nufacturing
32%
al
0
11
12
265
umber
treaty
umber
8
APAs executed include APAs that were renewed.

Bulletin No. 2020–15 615 April 6, 2020
Table 4a: Wholesale/Retail Trade APAs Executed in 2019
Wholesale/Retail Trade
Merchant Wholesalers, Durable Goods33
Merchant Wholesalers, Nondurable Goods
9
General Merchandise Stores
4
All Other Wholesalers
6
Table 4a
Merchan
Merchan
General
All Othe
Gener
a: Wholesale
Who
nt Wholesal
nt Wholesal
l Merchandis
er Wholesal
Merchant
Wholesaler
Nondurable G
17%
ral Merchandis
Stores
8%
A
l
Wh
e/Retail Tra
olesale/Reta
ers, Durable
ers, Nondura
se Stores
ers
t
rs,
Goods
e
ll Other
olesalers
12%
ade APAs E
ail Trade
e Goods
able Goods
Wholesale/
Finalized
7
Executed in 2
/Retail Trad
or Renewed
2019
33
9
4
6
de APAs
d 2019
Me
Wholesal
G
6
erchant
lers, Durable
Goods
63%
Table 4b: Manufacturing APAs Executed in 2019
Manufacturing
Transportation Equipment Manufacturing16
Computer and Electronic Product Manufacturing5
Chemical Manufacturing4
All Other Types of Manufacturing13
Table 4b
Transpo
Comput
Chemic
All Othe
b: Manufact
M
ortation Equi
ter and Elect
al Manufact
er Types of M
Tr
E
Ma
All Othe
Manu
f
34
turing APA
Manufacturi
ipment Manu
tronic Produ
turing
Manufacturi
ransportation
Equipment
anufacturing
42%
r Types of
facturing
4%
As Executed
ing
ufacturing
uct Manufact
ing
Manuf
Finalized
8
in 2019
turing
facturing AP
d or Renewe
16
5
4
13
PAs
ed 2019
Comp
Electro
Man
u
Chem
Manufa
c
11%
puter and
nic Product
ufacturing
13%
mical
cturing
%

April 6, 2020 616 Bulletin No. 2020–15
Part III. General Descriptions of APAs Executed in 2019
[Pub. L. 106-170 § 521(b)(2)(D) and (E)]
Nature of the Relationships
§ 521(b)(2)(D)(i)
Natureo
§ 521(b)(
As in pri
non-U.S
.
Covered
§ 521(b)(
Although
tangibleg
which ca
to seek o
wherever
9
APAs oft
All Othe
Covered T
1
PartI
of the Relati
(2)(D)(i)
or years, mo
. parents and
d Transactio
(2)(D)(ii-iii)
h most of the
goods or the
an be among
pportunitie
s
r appropriate
ten cover more
Non-U.S. P
U.S. Subs
62
%
Provision
by a U
2
Use of Inta
Property by
Entity
12%
Use of Int
Property b
U.S.E
6%
er Types of
Transactions
1%
III. Genera
[Pub.
ionships
ore than half
d U.S. subsid
ons, Functio
)
e transaction
e provision o
the most ch
to work wit
e, for transac

e than one type
arent &
idiary
%
Relation
n of Services
U.S. Entity
26%
angible
y a U.S.
y
%
tangible
y a Non-
Entity
%
Typ
al Descrip
. L. 106-170
fof the APA
diaries.
ons and Risk
ns
9
covered i
of services, a
hallenging tra
th taxpayers
ctions involv
of transaction
nships betwe
pes of Cove
9
ptions of A
0§ 521(b)(2)
s executed in
ks, and Test
n APAs exe
almost 20% c
ansactions in
and treaty p
ving the use
.
een Control
ered Transac
APAs Exec
)(D) and (E
n 2019 invo
ted Parties
cuted in 201
covered the
n APMA’s in
partners to pr
of intangible
Sister Comp
20%
U.S
.
U.
All Oth
Relation
2%
led Parties
ctions in 20
cuted in 20
E)]
lved transac
19 involve th
use of intang
nventory. Th
rovide prosp
e property.
mpanies
. Parent & No
n
.S. Subsidiary
16%
her
ships
in 2019
Sale of Tan
Property into t
24%
Provision of
S
by a Non-U.S
17%
Sale of Ta
n
Property fro
U.S.
14%
019
019
ctions betwee
he sale of
gible proper
he IRS conti
pective certa
n-
ngible
the U.S.
Services
S. Entity
ngible
om the
en
rty,
inues
ainty,
As in prior years, more than half of the APAs executed in 2019 involved transactions between non-U.S. parents and U.S. subsidiaries.
Covered Transactions, Functions and Risks, and Tested Parties
§ 521(b)(2)(D)(ii-iii)
Natureo
§ 521(b)(
As in pri
non-U.S
.
Covered
§ 521(b)(
Although
tangibleg
which ca
to seek o
wherever
9
APAs oft
All Othe
Covered T
1
PartI
of the Relati
(2)(D)(i)
or years, m
o
. parents and
d Transactio
(2)(D)(ii-iii)
h most of the
goods or the
an be among
pportunitie
s
r appropriate
ten cover more
Non-U.S. P
U.S. Subs
62
%
Provision
by a U
2
Use of Inta
Property by
Entity
12%
Use of Int
Property b
U.S.E
6%
er Types of
Transactions
1%
III. Genera
[Pub.
ionships
ore than half
d U.S. subsid
ons, Functio
)
e transaction
e provision o
the most ch
to work wit
e, for transac

e than one type
arent &
idiary
%
Relation
n of Services
U.S. Entity
26%
angible
y a U.S.
y
%
tangible
y a Non-
Entity
%
Typ
al Descrip
. L. 106-170
fof the APA
diaries.
ons and Risk
ns
9
covered i
of services, a
hallenging tra
th taxpayers
ctions involv
of transaction
nships betwe
pes of Cove
9
ptions of A
0§ 521(b)(2)
s executed in
ks, and Test
n APAs exe
almost 20% c
ansactions in
and treaty p
ving the use
.
een Control
ered Transac
APAs Exec
)(D) and (E
n 2019 invo
ted Parties
cuted in 20
1
covered the
n APMA’s in
partners to pr
of intangible
Sister Comp
20%
U.S
.
U.
All Oth
Relation
2%
led Parties
ctions in 20
cuted in 20
E)]
lved transa
c
19 involve th
use of intang
nventory. Th
rovide prosp
e property.
mpanies
. Parent & No
n
.S. Subsidiary
16%
her
ships
in 2019
Sale of Tan
Property into t
24%
Provision of
S
by a Non-U.S
17%
Sale of Ta
n
Property fro
U.S.
14%
019
019
ctions betwee
he sale of
gible proper
he IRS conti
pective certa
n-
ngible
the U.S.
Services
S. Entity
ngible
om the
en
rty,
inues
ainty,
Although most of the transactions
9
covered in APAs executed in 2019 involve the sale of tangible goods or the provision of services,
almost 20% covered the use of intangible property, which can be among the most challenging transactions in APMA’s inventory. The
IRS continues to seek opportunities to work with taxpayers and treaty partners to provide prospective certainty, wherever appropriate,
for transactions involving the use of intangible property.
9
APAs often cover more than one type of transaction.

Bulletin No. 2020–15 617 April 6, 2020
In the majority of APAs, the covered transactions involve numerous business functions and risks. For instance, with respect to func-
tions, APAs involving manufactured products typically involve a controlled group that conducts research and development (R&D),
engages in product design and engineering, manufactures the product, markets and distributes the product, and performs support
functions such as legal, finance, and human resources. Regarding risks, the controlled group may assume a variety of risks, including
market risks, R&D risks, financial risks, credit and collection risks, product liability risks, and general business risks. In the APA eval-
uation process, a significant amount of time and effort is devoted to understanding how the functions and risks are allocated amongst
the controlled group of companies that are party to the covered transactions. For methods requiring selection of a tested party, the
tested party that is chosen generally will be the least complex of the controlled taxpayers.
In the m
a
For insta
a control
and engi
n
supportf
group ma
and colle
process,
and risk
s
transactio
generally
Consisten
distributo
Transfe
r
§ 521(b)(
Consisten
the sale o
method/t
percent o
accounte
For cove
operatin
g
benchma
mark up
10
Not all A
N
ajority of AP
ance, with res
led group th
neering, man
functions suc
ay assume a
ection risks, p
a significant
s are allocate
ons. For met
y will be the
nt with prior
ors, U.S. ma
r PricingM
(2)(D)(iv)
nt with prior
of tangible p
transactional
of transfers o
d for the oth
red transfers
g margin (OM
ark results.I
on total cost
APAs executed
U.S.D
3
Non-U.S. Servic
Provider
7%
Non-
U
Manufa
5%
PAs, the cov
spect to func
hat conducts
nufactures th
ch as legal, f
variety of ri
product liab
t amount of t
ed amongst t
thods requiri
least comple
r years, appr
nufacturers,
Methods Used
r years, in 20
roperty and
l net margin
of tangible an
her 19 percen
s of tangible
M) continue
It was used 6
t, made up th

d in 2019 involv
Distributor
35%
Non-U.
ce
U.S.
acturer
%
ered transac
ctions, APAs
research and
he product, m
finance, and
isks, includin
ility risks, an
time and eff
the controlle
ing selection
ex of the con
roximately 8
or U.S. ser
v
d
019, the prim
the use of in
method (CP
nd intangible
nt of such tra
and intangib
s to be the m
64 percent of
he other 36 p
ved a tested pa
S. Distributor
8%
Types of
10
ctions involv
s involving m
d developme
markets and
human reso
ng market ri
nd general b
fort is devote
d group of c
n of a tested
ntrolled taxp
0 percent of
vice provider
mary transfer
ntangible pro
PM/TNMM)
e property w
ansactions.
ble property
most common
f the time. O
percent. As u
arty.
f Tested Par
ve numerous
manufacture
ent (R&D), e
distributest
urces. Regar
isks, R&D ri
business risk
ed to underst
companies th
party, the te
payers.
f the tested p
rs.
r pricing met
operty was th
. The CPM/T
while all othe
y that used th
n profit leve
Other PLIs, s
used here, O
U.S. Man
14
rties in 2019
business fun
ed products t
engages in p
the product,
rding risks, t
isks, financia
ks. In the APA
tanding how
hat are party
ested party th
parties in 201
thod (TPM)
he comparab
TNMM was
er methods c
he CPM/TNM
el indicator (
such as the B
OM means th
U.S. Se
nufacturer
4%
9
nctions and r
typically inv
product desig
and perform
the controlle
al risks, cred
A evaluation
w the function
to the cover
hat is chosen
19
10
were U.
used for bo
t
ble profits
s used for 81
combined
MM, the
(PLI) used to
Berry Ratio a
he ratio of
ervice Provider
31%
risks.
volve
gn
ms
ed
dit
n
ns
red
n
S.
th
o
and
r
Consistent with prior years, approximately 80 percent of the tested parties in 2019
10
were U.S. distributors, U.S. manufacturers, or
U.S. service providers.
Transfer Pricing Methods Used
§ 521(b)(2)(D)(iv)
Consistent with prior years, in 2019, the primary transfer pricing method (TPM) used for both the sale of tangible property and the
use of intangible property was the comparable profits method/transactional net margin method (CPM/TNMM). The CPM/TNMM
was used for 81 percent of transfers of tangible and intangible property while all other methods combined accounted for the other 19
percent of such transactions.
For covered transfers of tangible and intangible property that used the CPM/TNMM, the operating margin (OM) continues to be the
most common profit level indicator (PLI) used to benchmark results. It was used 64 percent of the time. Other PLIs, such as the Berry
Ratio and mark up on total cost, made up the other 36 percent. As used here, OM means the ratio of operating profits to sales,
11
and
“Berry Ratio” means the ratio of gross profit to operating expenses.
12
Most services transactions (82 percent) also used the CPM/
TNMM with the OM and mark up on total costs being the most common PLIs (used 65 percent of the time).
13
Sources of Comparables, Comparables Selection Criteria, and Nature of Adjustments to Comparables or Tested Party Data
§ 521(b)(2)(D)(v-vii)
For the APAs executed in 2019 that involved CPM/TNMM with a North American tested party, the most widely used data source for
comparables was Standard and Poor’s Compustat/Capital IQ database. Different sources were used in other cases (e.g., where the
tested party was not a U.S. or Canadian entity or where transaction-based methods were applied). The other more commonly used
databases are listed in the table below.
10
Not all APAs executed in 2019 involved a tested party.
11
See Treas. Reg. § 1.482-5(b)(4)(ii)(A).
12
See Treas. Reg. § 1.482-5(b)(4)(ii)(B).
13
In 2019, the majority of the APAs that covered services transactions also included tangible/intangible transactions, which were not tested under a separate PLI.

April 6, 2020 618 Bulletin No. 2020–15
Table 5: Sources of Comparable Data
Avention (formerly known as OneSource)Mergent
BloombergOrbis
DisclosureRecap
Global VantageRoyaltySource
ktMINERoyaltyStat
LoanConnectorWorldscope
In making comparability adjustments, the standard balance sheet adjustments identified in Treas. Reg. §§ 1.482-1(d) and 1.482-5(c),
including adjustments for differing amounts of payables, receivables, and inventory, were made in most cases. Where appropriate,
adjustments for different accounting practices were made to convert from LIFO to FIFO inventory accounting, and a small number
of cases also involved the accounting reclassification of expenses, e.g., from COGS to operating expenses.
Ranges, Goals, and Adjustment Mechanisms
§ 521(b)(2)(D)(viii-ix)
Most transactions covered in APAs target an interquartile range as described in Treas. Reg. § 1.482-1(e)(2)(iii)(C). Where the trans-
action involves a royalty payment for the use of intangible property, both specific royalty rates and ranges have been used. Where the
covered transaction is the payment of a royalty based solely on external royalty agreements, a secondary method, e.g., a test of the
post-royalty operating margin or cost-plus mark-up, has been used. The testing periods of the APAs executed in 2019 were either: (1)
a single year, (2) the term of the APA only, or (3) the term of the APA plus rollback years.
APAs executed in 2019 included several mechanisms for making adjustments to tested party results when the results fall outside the
range or do not match the point required by the APA. The following are examples of the mechanisms used: an adjustment bringing
the tested party’s results to the closer edge of the range applied to the results of a single year; an adjustment to the closer edge of the
range applied to the results over the APA term; an adjustment to the specified point or royalty rate; or an adjustment to the median of
the range for a single year.
Critical Assumptions
§ 521(b)(2)(D)(v)
The model APAs used by the IRS (included as Appendix 1 and Appendix 2 of this report) include standard critical assumptions that
there will be no material changes to the taxpayer’s business or to its tax or financial accounting practices during the APA term. A few
bilateral cases have also included critical assumptions tied either to the taxpayer’s profitability in a certain year or over the term of
the APA, or to the amount of non-covered transactions as a percentage of the taxpayer’s revenue. Pursuant to § 7.06(3) of Rev. Proc.
2015-41, APMA will cancel an APA in the event of a failure of a critical assumption unless the parties agree to revise the APA.

Bulletin No. 2020–15 619 April 6, 2020
Term Lengths of APAs Executed in 2019
§ 521(b)(2)(D)(x)
Table 6: Term Lengths of APAs Executed in 2019
Term Length (years)Number of APAs
11
22
33
411
553
615
713
87
95
102
115
132
151
Average6
As described in § 3.03(1) of Rev. Proc. 2015-41, taxpayers should request an APA term that would cover at least five prospective
years and may also request that the APA
be “rolled back” to cover one or more earlier taxable years, although the appropriate
APA term is decided on a case-by-case basis. Of the APAs executed in 2019, 25 percent included rollback years. A substantial number
of those APAs with terms of greater than five years were submitted as a request for a five-year term, and the additional years were
agreed to between the taxpayer and the IRS (or, in the case of a bilateral APA, between the IRS and the foreign government upon the
taxpayer’s request) to ensure a reasonable amount of prospectivity in the APA term.

April 6, 2020 620 Bulletin No. 2020–15
Amount of Time Taken to Complete New and Renewal APAs
§ 521(b)(2)(E)
Table 7: Months to Complete New and Renewal APAs Executed in 2019
UnilateralBilateralUnilateral & Bilateral
AverageMedianAverageMedianAverageMedian
New33.833.247.245.945.041.9
Renewal31.728.738.538.736.538.4
New & Renewal32.230.442.540.540.038.8
Months to Complete New and Renewal APAs Executed in 2019
number o
five-year
the case o
request)t
Amount
§ 521(b)(
Table 7:
New
Renewa
l
New & R
Months
The me
d
months in
Efforts
t
§ 521(b)(
As descri
demonstr
these ann
APMAP
report rev
variousT
Months to Complete
of those APA
r term, and th
of a bilateral
to ensure a r
of Time Ta
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Months to
l
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to Complet
ian time re
q
n 2018).
to Ensure C
(2)(F)
ibed in § 7.0
rate complia
nual reports a
Program mon
view also pr
TPMs adopte
0.0
5.0
10.0
15.0
20.0
25.0
30.0
35.0
40.0
45.0
50.0
Months
to
Complete
As with term
he additiona
l APA, betw
reasonable am
aken to Com
CompleteN
Unilater
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33.8
31.7
32.2
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Compliancew
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0
0
0
0
0
0
0
0
0
0
0
Average
Unil
a
ms of greater
al years were
ween the IRS
mount of pro
mplete New
New and Re
ral
MedianAv
33.2
28.7
30.4
Renewal AP
mplete an AP
with APAs
. Proc. 201
5
e terms and c
parts of the A
yer complian
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A process.
Median
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13
than five y
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and the for
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47.2
38.5
42.5
PAs Execute
PA in 2019 d
5-41, taxpaye
conditions o
APA process
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ears were sub
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in the APA t
wal APAs
As Executed
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r
45.9
38.7
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ed in 2019
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ers are requi
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lUnil
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bmitted as a
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term.
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ateral & Bila
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38.8 month
ired to file an
s. The filing
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temporaneou
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Renewal
The median time required to complete an APA in 2019 decreased to 38.8 months (from 40.2 months in 2018).
Efforts to Ensure Compliance with APAs
§ 521(b)(2)(F)
As described in § 7.02(1) of Rev. Proc. 2015-41, taxpayers are required to file annual reports to demonstrate compliance with the
terms and conditions of their APAs. The filing and review of these annual reports are critical parts of the APA process. Through annual
report review, the APMA Program monitors taxpayer compliance with APAs on a contemporaneous basis. Annual report review also
provides current information on the success or problems associated with the various TPMs adopted in the APA process.
Nature of Documentation Required in Annual Report
§ 521(b)(2)(D)(xi)
APAs require taxpayers to file timely and complete annual reports describing their operations and demonstrating compliance with the
APAs’ terms and conditions. Not every annual report will include each of the items listed in the following table
14
; they are required
where the facts demonstrate a need for such documentation.
14
The source of this list is the 2009 Model APA and requirements remain largely unchanged in the 2015 Model APA.

Bulletin No. 2020–15 621 April 6, 2020
1.
Statement regarding all material differences between Taxpayer’s business operations during APA year and description of
Taxpayer’s business operations contained in Taxpayer’s APA request. If there are no material differences, a statement to that
effect.
2.
Statement concerning all material changes in Taxpayer’s accounting methods and classifications, and methods of estimation,
from those described or used in Taxpayer’s request for the APA. If there has been no material change in accounting methods
and classifications or methods of estimation, a statement to that effect.
3.
Any change to the taxpayer notice information.
4.
Description of any failure to meet critical assumptions. If there has been none, a statement to that effect.
5.
Statement identifying whether or not any material information submitted while the APA request was pending is discovered
to be false, incorrect, or incomplete.
6
The amount, reason for, and financial analysis of any compensating adjustment, for the APA year, including but not limited to:
the amounts paid or received by each affected entity; the character (such as capital or ordinary expense) and country source of
the funds transferred, and the specific line item(s) of any affected U.S. tax return; and any change to any entity classification
for federal income tax purposes of any member of Taxpayer’s group that is relevant to the APA.
7.
The amounts, description, reason for, and financial analysis of any book-tax difference relevant to the TPM for the APA year,
as reflected on Schedule M-1 or Schedule M-3 of the U.S. return for the AP
A year .
8.
Statement regarding whether
Taxpayer contemplates requesting, or has requested, to renew, modify, or cancel the APA.
9.
Financial statements and any necessary account detail to show compliance with the TPM, with a copy of the opinion from an
independent certified public accountant or other documentation required by paragraph 5(f) of the AP
A.
10.
Financial analysis demonstrating Taxpayer
’s compliance with TPM.
11.
Organizational chart.
12.
A copy of the APA and any amendment.
13.
A penalty of perjury statement.
Approaches for Sharing of Currency or Other Risks
§ 521(b)(2)(D)(xii)
In appropriate cases, APAs may provide specific approaches for dealing with risks, including currency risk, such as adjustment mech-
anisms and/or critical assumptions.

April 6, 2020 622 Bulletin No. 2020–15
APPENDIX 1– Model APA (based on Rev. Proc. 2006-9)
ADVANCE PRICING AGREEMENT
between
[Insert Taxpayer’s Name]
and
THE INTERNAL REVENUE SERVICE
PARTIES
The Parties to this Advance Pricing Agreement (APA) are the Internal Revenue Service (IRS) and [Insert Taxpayer’s Name], EIN
________.
RECITALS
[Insert Taxpayer Name] is the common parent of an affiliated group filing consolidated U.S. tax returns (collectively referred to as
“Taxpayer”), and is entering into this APA on behalf of itself and other members of its consolidated group.
Taxpayer’s principal place of business is [City, State]. [Insert general description of taxpayer and other relevant parties].
This APA contains the Parties’ agreement on the best method for determining arm’s-length prices of the Covered Transactions
under I.R.C. section 482, the Treasury Regulations thereunder, and any applicable tax treaties.
{If renewal, add} [Taxpayer and IRS previously entered into an APA covering taxable years ending _____ to ______, executed on
________.]
AGREEMENT
The Parties agree as follows:
1. Covered Transactions. This APA applies to the Covered Transactions, as defined in Appendix A.
2. Transfer Pricing Method. Appendix A sets forth the Transfer Pricing Method (TPM) for the Covered Transactions.
3. Term. This APA applies to the APA Term, as defined in Appendix A.
4. Operation.
a. Revenue Procedure 2006-9 governs the interpretation, legal effect, and administration of this APA.
b. Nonfactual oral and written representations, within the meaning of sections 10.04 and 10.05 of Revenue Procedure 2006-9
(including any proposals to use particular TPMs), made in conjunction with the APA Request constitute statements made in
compromise negotiations within the meaning of Rule 408 of the Federal Rules of Evidence.
5. Compliance.
a. Taxpayer must report its taxable income in an amount that is consistent with Appendix A and all other requirements of this
APA on its timely filed U.S. Return. However, if Taxpayer’s timely filed U.S. Return for any taxable year covered by this
APA (APA Year) is filed prior to, or no later than 60 days after, the effective date of this APA, then Taxpayer must report its
taxable income for that APA Year in an amount that is consistent with Appendix A and all other requirements of this APA
either on the original U.S. Return or on an amended U.S. Return filed no later than 120 days after the effective date of this
APA, or through such other means as may be specified herein.
b. {Use or edit the following when U.S. Group or Foreign Group contains more than one member.} [This APA addresses the
arm’s-length nature of prices charged or received in the aggregate between Taxpayer and Foreign Participants with respect
to the Covered Transactions. Except as explicitly provided, this APA does not address and does not bind the IRS with respect
to prices charged or received, or the relative amounts of income or loss realized, by particular legal entities that are members
of U.S. Group or that are members of Foreign Group.]
c. For each APA Year, if Taxpayer complies with the terms and conditions of this APA, then the IRS will not make or propose
any allocation or adjustment under I.R.C. section 482 to the amounts charged in the aggregate between Taxpayer and For-
eign Participant[s] with respect to the Covered Transactions.
d. If Taxpayer does not comply with the terms and conditions of this APA, then the IRS may:

Bulletin No. 2020–15 623 April 6, 2020
i. enforce the terms and conditions of this APA and make or propose allocations or adjustments under I.R.C. section 482
consistent with this APA;
ii. cancel or revoke this APA under section 11.06 of Revenue Procedure 2006-9; or
iii. revise this APA, if the Parties agree.
e. Taxpayer must timely file an Annual Report (an original and four copies) for each APA Year in accordance with Appendix C
and section 11.01 of Revenue Procedure 2006-9. Taxpayer must file the Annual Report for all APA Years through the APA
Year ending [insert year] by [insert date]. Taxpayer must file the Annual Report for each subsequent APA Year by [insert
month and day] immediately following the close of that APA Year. (If any date falls on a weekend or holiday, the Annual
Report shall be due on the next date that is not a weekend or holiday.) The IRS may request additional information reason-
ably necessary to clarify or complete the Annual Report. Taxpayer will provide such requested information within 30 days.
Additional time may be allowed for good cause.
f. The IRS will determine whether Taxpayer has complied with this APA based on Taxpayer’s U.S. Returns, the Financial
Statements, and other APA Records, for the APA Term and any other year necessary to verify compliance. For Taxpayer
to comply with this APA, {use the following or an alternative} an independent certified public accountant must render an
opinion that Taxpayer’s Financial Statements present fairly, in all material respects, Taxpayer’s financial position under U.S.
GAAP.
g. In accordance with section 11.04 of Revenue Procedure 2006-9, Taxpayer will (1) maintain the APA Records, and (2) make
them available to the IRS in connection with an examination under section 11.03. Compliance with this subparagraph consti-
tutes compliance with the record-maintenance provisions of I.R.C. sections 6038A and 6038C for the Covered Transactions
for any taxable year during the APA Term.
h. The True Taxable Income within the meaning of Treasury Regulations sections 1.482-1(a)(1) and (i)(9) of a member of an
affiliated group filing a U.S. consolidated return will be determined under the I.R.C. section 1502 Treasury Regulations.
i. {Optional for US Parent Signatories} To the extent that Taxpayer’s compliance with this APA depends on certain acts of
Foreign Group members, Taxpayer will ensure that each Foreign Group member will perform such acts.
6. Critical Assumptions. This APA’s critical assumptions, within the meaning of Revenue Procedure 2006-9, section 4.05, appear in
Appendix B. If any critical assumption has not been met, then Revenue Procedure 2006-9, section 11.06, governs.
7. Disclosure. This APA, and any background information related to this APA or the APA Request, are: (1) considered “return in-
formation” under I.R.C. section 6103(b)(2)(C); and (2) not subject to public inspection as a “written determination” under I.R.C.
section 6110(b)(1). Section 521(b) of Pub. L. 106-170 provides that the Secretary of the Treasury must prepare a report for public
disclosure that includes certain specifically designated information concerning all APAs, including this APA, in a form that does
not reveal taxpayers’ identities, trade secrets, and proprietary or confidential business or financial information.
8. Disputes. If a dispute arises concerning the interpretation of this APA, the Parties will seek a resolution by the Director of the
Advance Pricing and Mutual Agreement Program, to the extent reasonably practicable, before seeking alternative remedies.
9. Materiality. In this APA the terms “material” and “materially” will be interpreted consistently with the definition of “material
facts” in Revenue Procedure 2006-9, section 11.06(4).
10. Section Captions. This APA’s section captions, which appear in italics, are for convenience and reference only. The captions do
not affect in any way the interpretation or application of this APA.
11. Terms and Definitions. Unless otherwise specified, terms in the plural include the singular and vice versa. Appendix D contains
definitions for capitalized terms not elsewhere defined in this APA.
12. Entire Agreement and Severability. This APA is the complete statement of the Parties’ agreement. The Parties will sever, delete,
or reform any invalid or unenforceable provision in this APA to approximate the Parties’ intent as nearly as possible.
13. Successor in Interest. This APA binds, and inures to the benefit of, any successor in interest to Taxpayer.
14. Notice. Any notices required by this APA or Revenue Procedure 2006-9 must be in writing. Taxpayer will send notices to the IRS
at the address and in the manner set forth in Revenue Procedure 2006-9, section 4.11. The IRS will send notices to:
Taxpayer Corporation
Attn: Jane Doe, Sr. Vice President (Taxes)
1000 Any Road
Any City, USA 10000
(phone: _________)
15. Effective Date and Counterparts. This APA is effective starting on the date, or later date of the dates, upon which all Parties
execute this APA. The Parties may execute this APA in counterparts, with each counterpart constituting an original.

April 6, 2020 624 Bulletin No. 2020–15
WITNESS,
The Parties have executed this APA on the dates below.
[Taxpayer Name in all caps]
By: ___________________________ Date: ___________________, 201___
Jane Doe
Sr. Vice President (Taxes)
IRS
By: ___________________________ Date: ___________________, 201___
John C. C. Hughes
Director, Advance Pricing and Mutual
Agreement Program

Bulletin No. 2020–15 625 April 6, 2020
APPENDIX A
COVERED TRANSACTIONS AND TRANSFER PRICING METHOD (TPM)
1. Covered Transactions.
[Define the Covered Transactions.]
2. APA Term.
This APA applies to Taxpayer’s taxable years ending __________ through ________ (APA Term).
3. TPM.
{Note: If appropriate, adapt language from the following examples.}
[The Tested Party is __________.]
• CUP Method
The TPM is the comparable uncontrolled price (CUP) method. The Arm’s Length Range of the price charged for
_________ is between _______ and ___________ per unit.
• CUT Method
The TPM is the CUT Method. The Arm’s Length Range of the royalty charged for the license of ______is between
____% and ___ % of [Taxpayer’s, Foreign Participants’, or other specified party’s] Net Sales Revenue. [Insert defi-
nition of net sales revenue or other royalty base.]
• Resale Price Method (RPM)
The TPM is the resale price method (RPM). The Tested Party’s Gross Margin for any APA Year is defined as fol-
lows: the Tested Party’s gross profit divided by its sales revenue (as those terms are defined in Treasury Regulations
sections 1.482-5(d)(1) and (2)) for that APA Year. The Arm’s Length Range is between ____% and ___ %, and the
Median of the Arm’s Length Range is ___%.
• Cost Plus Method
The TPM is the cost plus method. The Tested Party’s Cost Plus Markup is defined as follows for any APA Year: the
Tested Party’s ratio of gross profit to production costs (as those terms are defined in Treasury Regulations sections
1.482-3(d)(1) and (2)) for that APA Year. The Arm’s Length Range is between ___% and ___%, and the Median of
the Arm’s Length Range is ___%.
• CPM with Berry Ratio PLI
The TPM is the comparable profits method (CPM). The profit level indicator is a Berry Ratio. The Tested Party’s Ber-
ry Ratio is defined as follows for any APA Year: the Tested Party’s gross profit divided by its operating expenses (as
those terms are defined in Treasury Regulations sections 1.482-5(d)(2) and (3)) for that APA Year. The Arm’s Length
Range is between ____ and ___, and the Median of the Arm’s Length Range is ___.
• CPM using an Operating Margin PLI
The TPM is the comparable profits method (CPM). The profit level indicator is an operating margin. The Tested Par-
ty’s Operating Margin is defined as follows for any APA Year: the Tested Party’s operating profit divided by its sales
revenue (as those terms are defined in Treasury Regulations section 1.482-5(d)(1) and (4)) for that APA Year. The
Arm’s Length Range is between ____% and ___ %, and the Median of the Arm’s Length Range is ___%.
• CPM using a Three-year Rolling Average Operating Margin PLI
The TPM is the comparable profits method (CPM). The profit level indicator is an operating margin. The Tested
Party’s Three-Year Rolling Average operating margin is defined as follows for any APA Year: the sum of the Tested
Party’s operating profit (within the meaning of Treasury Regulation section 1.482-5(d)(4) for that APA Year and the
two preceding years, divided by the sum of its sales revenue (within the meaning of Treasury Regulation section
1.482-5(d)(1)) for that APA Year and the two preceding years. The Arm’s Length Range is between ____% and
____%, and the Median of the Arm’s Length Range is ___%.
• Residual Profit Split Method
The TPM is the residual profit split method. [Insert description of routine profit level determinations and residual
profit-split mechanism].
[Insert additional provisions as needed.]

April 6, 2020 626 Bulletin No. 2020–15
4. Application of TPM.
For any APA Year, if the results of Taxpayer’s actual transactions produce a [price per unit, royalty rate for the Covered Transactions]
[or] [Gross Margin, Cost Plus Markup, Berry Ratio, Operating Margin, Three-Year Rolling Average Operating Margin for the Tested
Party] within the Arm’s Length Range, then the amounts reported on Taxpayer’s U.S. Return must clearly reflect such results.
For any APA year, if the results of Taxpayer’s actual transactions produce a [price per unit, royalty rate] [or] [Gross Margin, Cost
Plus Markup, Berry Ratio, Operating Margin, Three-Year Rolling Average Operating Margin for the Tested Party] outside the Arm’s
Length Range, then amounts reported on Taxpayer’s U.S. Return must clearly reflect an adjustment that brings the [price per unit,
royalty rate] [or] [Tested Party’s Gross Margin, Cost Plus Markup, Berry Ratio, Operating Margin, Three-Year Rolling Average Op-
erating Margin] to the Median.
For purposes of this Appendix A, the “results of Taxpayer’s actual transactions” means the results reflected in Taxpayer’s and Tested
Party’s books and records as computed under U.S. GAAP [insert another relevant accounting standard if applicable], with the fol-
lowing adjustments:
(a) [The fair value of stock-based compensation as disclosed in the Tested Party’s audited financial statements shall be treated as an
operating expense]; and
(b) To the extent that the results in any prior APA Year are relevant (for example, to compute a multi-year average), such results shall
be adjusted to reflect the amount of any adjustment made for that prior APA Year under this Appendix A.
5. APA Revenue Procedure Treatment
If Taxpayer makes an adjustment under paragraph 4 of this Appendix A (a “primary adjustment”), Taxpayer and its related foreign
entity may elect APA Revenue Procedure Treatment in accordance with section 11.02(3) of Revenue Procedure 2006-9 and avoid the
possible adverse tax consequences of a secondary adjustment that would otherwise follow the primary adjustment.
[Insert additional provisions as needed.]

Bulletin No. 2020–15 627 April 6, 2020
APPENDIX B
CRITICAL ASSUMPTIONS
This APA’s critical assumptions are:
1. The business activities, functions performed, risks assumed, assets employed, and financial and tax accounting methods and
classifications [and methods of estimation] of Taxpayer in relation to the Covered Transactions will remain materially the same as
described or used in Taxpayer’s APA Request. A mere change in business results will not be a material change.
[Insert additional provisions as needed.]

April 6, 2020 628 Bulletin No. 2020–15
APPENDIX C
APA RECORDS AND ANNUAL REPORT
APA RECORDS
The APA Records will consist of all documents listed below for inclusion in the Annual Report, as well as all documents, notes, work
papers, records, or other writings that support the information provided in such documents.
ANNUAL REPORT
The Annual Report (and each of the four copies required by paragraph 5(e) of this APA) will include:
1. Two copies of a properly completed APA Annual Report Summary in the form of Appendix E to this APA, one copy of the form
bound with, and one copy provided separately from, the rest of the Annual Report.
2. A table of contents, organized as follows:
3. Statements that fully identify, describe, analyze, and explain:
a. All material differences between the U.S. Group’s business operations (including functions, risks assumed, markets, con-
tractual terms, economic conditions, property, services, and assets employed) during the APA Year from the business oper-
ations described in the APA Request. If there have been no material differences, the Annual Report will include a statement
to that effect.
b. All material differences between the U.S. Group’s accounting methods and classifications, and methods of estimation used
during the APA Year, from those described or used in the APA Request. If any change was made to conform to changes in
U.S. GAAP (or other relevant accounting standards) Taxpayer will specifically identify the change. If there has been no ma-
terial change in accounting methods and classifications or methods of estimation, the Annual Report will include a statement
to that effect.
c. Any change to the Taxpayer notice information in paragraph 14 of this APA.
d. Any failure to meet any critical assumption. If there has been no failure, the Annual Report will include a statement to that
effect.
e. Whether or not material information submitted while the APA Request was pending is discovered to be false, incorrect, or
incomplete.
f. Any change to any entity classification for federal income tax purposes (including any change that causes an entity to be
disregarded for federal income tax purposes) of any Worldwide Group member that is a party to the Covered Transactions
or is otherwise relevant to the TPM.
g. The amount, reason for, and financial analysis of (1) any primary adjustments made under Appendix A for the APA Year; and
(2) any (a) secondary adjustments that follow such primary adjustments or (b) accounts receivable that Taxpayer establishes,
in lieu of secondary adjustments, by electing APA Revenue Procedure Treatment pursuant to paragraph 5 of Appendix A and
Revenue Procedure 2006-9, section 11.02(3), for the APA Year, including but not limited to:
i. the amounts due or owed, and paid or received by each affected entity;
ii. the character (such as capital, ordinary, income, expense) and country source of the funds transferred, and the specific
affected line item(s) of any affected U.S. Return;
iii. the date(s) and means by which the payments are or will be made; and
iv. whether or not APA Revenue Procedure Treatment was elected pursuant to paragraph 5 of Appendix A and Revenue
Procedure 2006-9, section 11.02(3).
h. The amounts, description, reason for, and financial analysis of any book-tax difference relevant to the TPM for the APA Year,
as reflected on Schedule M-1 or Schedule M-3 of the U.S. Return for the APA Year.
i. Whether Taxpayer contemplates requesting, or has requested, to renew, modify, or cancel the APA.
4. The Financial Statements, and any necessary account detail to show compliance with the TPM, including consolidating financial
statements, segmented financial data, records from the general ledger, or similar information if the assets, liabilities, income, or
expenses relevant to showing compliance with the TPM are a subset of the assets, liabilities, income, or expenses presented in
the Financial Statements.
5. {Use the following or the alternative prescribed by paragraph 5(f) of this APA:} A copy of the independent certified public ac-
countant’s opinion required by paragraph 5(f) of this APA.

Bulletin No. 2020–15 629 April 6, 2020
6. A financial analysis that reflects Taxpayer’s TPM calculations for the APA Year. The calculations must reconcile with and refer-
ence the information required under item 4 above in sufficient account detail to allow the IRS to determine whether Taxpayer has
complied with the TPM.
7. An organizational chart for the Worldwide Group, revised annually to reflect all ownership or structural changes of entities that
are parties to the Covered Transactions or are otherwise relevant to the TPM.
8. A copy of the APA and any amendment.
9. A penalty of perjury statement, executed in accordance with Revenue Procedure 2006-9, section 11.01(6) and (7).

April 6, 2020 630 Bulletin No. 2020–15
APPENDIX D
DEFINITIONS
The following definitions control for all purposes of this APA. The definitions appear alphabetically below:
TermDefinition
Annual ReportA report within the meaning of Revenue Procedure 2006-9, section 11.01.
A PAThis Advance Pricing Agreement, which is an “advance pricing agreement” within the meaning
of Revenue Procedure 2006-9, section 2.04.
APA RecordsThe records specified in Appendix C.
APA RequestTaxpayer’s request for this APA dated _________, including any amendments or supplemental or
additional information thereto.
APA YearThis term is defined in paragraph 5(a) of this APA.
Covered Transaction(s)This term is defined in Appendix A.
Financial StatementsFinancial statements prepared in accordance with U.S. GAAP and stated in U.S. dollars.
Foreign GroupWorldwide Group members that are not U.S. persons.
Foreign Participants[name the foreign entities involved in Covered Transactions].
I.R.C.The Internal Revenue Code of 1986, 26 U.S.C., as amended.
Pub. L. 106-170The Ticket to Work and Work Incentives Improvement Act of 1999.
Revenue Procedure 2006-9Rev. Proc. 2006-9, 2006-1 C.B. 278.
Transfer Pricing Method
(TPM)
A transfer pricing method within the meaning of Treasury Regulation section 1.482-1(b) and
Revenue Procedure 2006-9, section 2.04.
U.S. GAAPU.S. generally-accepted accounting principles.
U.S. GroupWorldwide Group members that are U.S. persons.
U.S. ReturnFor each taxable year, the “returns with respect to income taxes under subtitle A” that Taxpayer
must “make” in accordance with I.R.C. section 6012. {Or substitute for partnership: For each
taxable year, the “return” that Taxpayer must “make” in accordance with I.R.C. section 6031.}
Worldwide GroupTaxpayer and all organizations, trades, businesses, entities, or branches (whether or not incorpo-
rated, organized in the United States, or affiliated) owned or controlled directly or indirectly by
the same interests.

Bulletin No. 2020–15 631 April 6, 2020
APPENDIX E
APA ANNUAL REPORT SUMMARY FORM
The APA Annual Report Summary on the next page is a required APA Record. The APA Team Leader supplies some of the infor-
mation requested on the form. Taxpayer is to supply the remaining information requested by the form and submit the form as part of
its Annual Report.
APA Annual
Report
SUMMARY
Department of the Treasury--Internal Revenue Service
Large Business and International Division
Treaty and Transfer Pricing Operations
Advance Pricing and Mutual Agreement Program
APA No. __________________________
Team Leader _______________________
Economist _________________________
Intl Examiner _______________________
APA Information
Taxpayer Name: ___________________________________________________
Taxpayer EIN:_________________ NAICS:___________________
APA Term: Taxable years ending ________ to ____________
Original APA [ ] Renewal APA [ ]
Annual Report due dates:
_________________, 201__ for all APA Years through APA Year ending in 200__; for each APA Year
thereafter, on _________________ [month and day] immediately following the close of the APA Year
Principal foreign country(ies) involved in covered transaction(s): _________________________________
______
Type of APA: [ ] unilateral [ ] bilateral with ________________
Tested party is [ ] US [ ] foreign [ ] both
Approximate dollar volume of covered transactions (on an annual basis) involving tangible goods and
services:
[ ] N/A [ ] <$50 million [ ] $50-100 million [ ] $100-250 million [ ] $250-500 million [ ] >$500 million
APA tests on (check all that apply):
[ ] annual basis [ ] multi-year basis [ ] term basis
APA provides (check all that apply) a:
[ ] range [ ] point [ ] floor only [ ] ceiling only [ ] other_____________
APA provides for adjustment (check all that apply) to:
[ ] nearest edge [ ] median [ ] other point

April 6, 2020 632 Bulletin No. 2020–15
APA Annual Report
APA date executed: ______________, 201__
Information
This APA Annual Report Summary is for APA Year(s) ending in 200__ and was filed on
_____________, 201__
(to be completedCheck here [ ] if Annual Report was filed after original due date but in accordance with extension.
by the Taxpayer)Has this APA been amended or changed? [ ] yes [ ] no
Effective Date:
______________________
Has Taxpayer complied with all APA terms and conditions? [ ] yes [ ] no
Were all the critical assumptions met? [ ] yes [ ] no
Has a Primary Compensating Adjustment been made in any APA Year covered by this Annual Report?
[ ] yes [ ] no If yes, which year(s): 200___
Have any necessary Secondary Compensating Adjustments been made? [ ] yes [ ] no
Did Taxpayer elect APA Revenue Procedure treatment? [ ] yes [ ] no
Any change to the entity classification of a party to the APA? [ ] yes [ ] no
Taxpayer notice information contained in the APA remains unchanged? [ ] yes [ ] no
Taxpayer's current US principal place of business: (City, State) ________________________________
APA Annual Report
Financial analysis reflecting TPM calculations[ ] yes [ ] no
Checklist of
Financial statements showing compliance with TPM(s)[ ] yes [ ] no
Key Contents
Schedule M-1 or M-3 book-tax differences[ ] yes [ ] no
(to be completedCurrent organizational chart of relevant portion of world-wide group[ ] yes [ ] no
by the Taxpayer)Attach copy of APA[ ] yes [ ] no
Other APA records and documents included:
Contact Information
Authorized RepresentativePhone NumberAffiliation and Address

Bulletin No. 2020–15 633 April 6, 2020
APPENDIX 2– Model APA (based on Rev. Proc. 2015-41)
TEMPLATE FOR ADVANCE PRICING AGREEMENT
UNDER REVENUE PROCEDURE 2015-41
_______________
The Advance Pricing and Mutual Agreement Program (“APMA”) of the Internal Revenue Service (“IRS”) is providing this
template for use in drafting advance pricing agreements (“APAs”) issued under IRS Revenue Procedure 2015-41, 2015-35 I.R.B.
263 (“Rev. Proc. 2015-41”). This template is designed to systematize how taxpayers propose terms for their APAs and standardize
language used in executed APAs. It will improve efficiency in the APA process and enhance consistency in the administration of the
APA program.
Rev. Proc. 2015-41 requires that taxpayers include as part of a complete APA request a draft APA and a “redline” comparison of the
proposed draft APA against the current model APA. See section 2.03, exhibit 15, of the Appendix to Rev. Proc. 2015-41. This template
serves as the model APA. A taxpayer is required to produce the “redline” comparison by following the instructions below to edit this
template with tracked changes. The draft APA and “redline” comparison are then to be included in Word format in the complete APA
request. (Before editing the template with tracked changes, a taxpayer should remove this introduction and the instructions below
from the Microsoft Word file.)
The assigned APMA team will review the APA’s terms proposed in the draft APA. If the APMA team accepts the proposed terms
in light of its review of the taxpayer’s complete APA request and other information obtained during the APA process, then the text of
the draft APA, edited as needed to fill in any information not available at the time of the APA Request, will be adopted as the text of
a finally executed APA. If the APMA team does not accept the proposed terms, it will discuss modifications to the draft APA with the
taxpayer during the APA process. For bilateral and multilateral APAs, the terms of the executed APA will of necessity be consistent
with the terms of the underlying mutual agreement between the United States and one or more treaty partners.
GENERAL INSTRUCTIONS
The template is designed to minimize editing by using an options-based format for selecting from terms presented in certain sec-
tions of the model APA. The options presented are those which APMA considers standard and which it has accepted in final APAs.
These options are not binding on APMA, however. APMA reserves the right to modify the option selections, the specific option lan-
guage used, or any other terms before executing an APA with the taxpayer.
Options are indicated by square brackets (“[]”). An “x” should be inserted between the brackets to indicate the selected option
(“[x]”). Options that are not selected should not be deleted, but instead should be left in the text of the draft APA. The options to which
APMA and the taxpayer ultimately agree for the final APA will be indicated by the presence or absence of an “x”. The term associated
with the “x” will be given operative effect in the executed APA.
Certain options are flagged with an asterisk after the square brackets (“[]*”). To facilitate the APMA team’s subsequent review of
the draft APA, the asterisks should not be deleted. Taxpayers that select flagged options are required to specifically provide justifica-
tion for the selection in the APA request. See section 1.02, Part 5, of the Appendix to Rev. Proc. 2015-41.
The template contains placeholder phrases consisting of a hashtag followed by one or more words in block capital letters (e.g.,
“#COUNTRY”). Generally, the taxpayer should replace a placeholder phrase with appropriate text, subject to the following conven-
tions:
• If a placeholder phrase occurs within an option that the taxpayer has rejected, the taxpayer should change the hashtag to a
caret (e.g., change “#COUNTRY” to “^COUNTRY”) but otherwise leave the phrase intact.
15
The caret indicates that the
Taxpayer has rejected this option. For example, for a bilateral APA with Japan, the lines on the first page just below the title
would read:
[x] Bilateral with Japan
[] Multilateral with ^COUNTRIES
[] Unilateral
• The placeholder phrase “#CURRENCY” should be replaced, for example, with “U.S. dollars,” “Euros,” or “Japanese yen.”
• The placeholder phrase “#DATE” should be replaced with a date in the format of “December 31, 2020.”
The APA Term will be expressed as dates certain, e.g., “January 1, 2017 to December 31, 2022, inclusive”, rather than as particular
tax years.
15
As a result, almost all occurrences of the hashtag in the template will be replaced with a caret or other text in the taxpayer’s draft APA. The few remaining occurrences of the hashtag will
mark a placeholder phrase that cannot yet be replaced with appropriate text (see, for example, the placeholder phrase in paragraph 6(e) for a date that cannot be determined until the APA nears
execution). Searching the draft APA for the hashtag will locate all placeholder phrases that still need replacement.

April 6, 2020 634 Bulletin No. 2020–15
Taxpayers may need to draft custom text for situations or options not included in the template. For example, a taxpayer may pro-
pose additional critical assumptions to address specific regulatory contingencies or conditions the taxpayer is expected to face during
the term of the APA. As another example, the provision titled “Limitation on Assistance” at the end of the Recitals might be modified
based on an understanding reached in the prefiling stage of the APA process. In some cases, a particular critical assumption might fa-
cilitate reaching an agreement on an APA. Taxpayers that include custom text are required to specifically provide justification for the
inclusion in the APA request, just as selecting an option with an asterisk requires justification. Any custom text must also be evident
in the “redline” comparison of the proposed draft APA.
INSTRUCTIONS ON TABLES
The template contains certain tables that the taxpayer should edit. Entries in the tables will not contain hashtags, but taxpayers
nevertheless should fill in the information and add additional rows to the tables if needed. Taxpayers also should fill in the “APA
Information” in the table in Appendix D, to the extent available or proposed.
INSTRUCTIONS ON APPENDIX A
Appendix A of this template contains the description of the APA’s covered issue(s) and covered method(s). Taxpayers should note
the following points in completing Appendix A:
• The template includes just one covered issue with one corresponding covered method. If there is more than one covered Is-
sue proposed for the APA, the taxpayer should add additional covered issues in Appendix A, section 3, with tracked changes.
• If there is more than one covered method, the taxpayer should first replicate the template’s entire text for Covered Method
1 in Appendix A, section 4, without tracked changes, to provide template text for each additional covered method, and then
edit the text for each covered method with tracked changes.
• Normally, each covered issue will have its own corresponding covered method. However, in some cases, a covered method
may apply at once to more than one covered issue. For example, covered issues may be proposed to be aggregated and tested
by a single covered method. In such cases, the heading for that covered method could read, for example, “Covered Method
for Covered Issues 1-3”.
• Any interaction between different covered methods should be adequately explained in the text, and in an appropriate man-
ner. For example, an explanation might be provided in an introduction at the start of section 4 of Appendix A, preceding the
description of the respective covered methods.
Appendix A uses the term “Tested Party.” When applied in the context of methods that consider, or test, data from only one party
to a transaction, this term is similar in concept to the term “tested party” as discussed in the OECD Guidelines at paragraphs 3.18
and 3.19, and as defined in the U.S. Treasury Regulations section 1.482-5(b)(2). However, some methods consider, or test, data from
both parties to a transaction, where there is no singular “tested” party. Even in applying such methods, however, it is typically the
case that one particular party’s results are formally tested for compliance with the method. For purposes of this template, in such
circumstances, the party whose results are formally tested in applying any particular method is the “Tested Party”, even if that party
is not strictly a “tested party” as discussed in the OECD Guidelines paragraphs 3.18 and 3.19, or as defined in the U.S. Treasury
Regulations section 1.482-5(b)(2).

Bulletin No. 2020–15 635 April 6, 2020
ADVANCE PRICING AGREEMENT
between
#SIGNATORY
and
THE INTERNAL REVENUE SERVICE
[] Bilateral with #COUNTRY
[] Multilateral with #COUNTRIES
[] Unilateral
Term: #DATE to #DATE, inclusive
[] This APA is commonly referred to as #APA NAME.
PARTIES
The Parties to this APA are the Internal Revenue Service (“IRS”) and #NAME OF EACH NON-IRS SIGNATORY, WITH EIN.
[] #SIGNATORY will be referred to as “U.S. Taxpayer.”
[] #SIGNATORY is the common parent of an affiliated group filing consolidated U.S. tax returns and is entering into this APA
on behalf of both itself and the following members of its consolidated group: #MEMBERS OF GROUP. All members of this
consolidated group will be referred to collectively as “U.S. Taxpayer.”
RECITALS
[] This APA is a renewal of one or more prior APAs, which are listed below in reverse chronological order:
Party(ies)Execution DateTerm
Key:
• Party(ies): The signatory(ies) to the prior APA, other than the IRS, with each signatory’s taxpayer identification number;
• Execution Date: The date, or the later of the dates, on which the prior APA was executed;
• Term: The term of the prior APA.
[] This is a bilateral APA within the meaning of Rev. Proc. 2015-41 and implements the terms of a mutual agreement reached be-
tween the United States and #COUNTRY.
[] This is a multilateral APA within the meaning of Rev. Proc. 2015-41 and implements the terms of a mutual agreement reached
among the United States, #COUNTRIES.
[] This APA is a unilateral APA within the meaning of Rev. Proc. 2015-41 and is not based on any mutual agreement.
The Parties to this APA are defined in the ”Parties” section above. Regarding the Party(ies) to this APA other than the IRS:
[] No such Party has an immediate parent or owner that is not a U.S. entity.
[] One or more such Parties has an immediate parent or owner that is not a U.S. entity, as follows:
PartyParent’s or Owner’s
Identifying Information
Parent’s or Owner’s
Contact Information
Key:
• Party: Name of the Party having an immediate parent or owner that is not a U.S. entity;
• Parent’s or Owner’s Identifying Information: Name of the immediate parent or owner of such Party, and the taxpayer
identification number of that parent or owner for income tax purposes in its country of residence;

April 6, 2020 636 Bulletin No. 2020–15
• Parent’s or Owner’s Contact Information: The immediate parent’s or owner’s address and phone number.
The term “Worldwide Group” is defined below in paragraph 12 of this APA. The ultimate parent entity or owner of Worldwide
Group is:
#ENTITY NAME, ADDRESS, AND PHONE
U.S. Taxpayer’s principal place of business is #CITY, #STATE. #BRIEF DESCRIPTION OF U.S. TAXPAYER AND NON-U.S.
TAXPAYER (DEFINED IN SECTION 1 OF APPENDIX A), AND SPECIFICALLY OF EACH COVERED ENTITY (DEFINED
IN SECTION 1 OF APPENDIX A).
This APA contains the Parties’ agreement on the Covered Method(s) for resolving the Covered Issue(s) under Code section 482 and
any other Code sections that are identified in Appendix A to this APA, the U.S. Treasury Regulations thereunder, and (if applicable):
[] The income tax convention(s) between the United States and #COUNTRY(IES).
This APA shall not limit the authority of the IRS to (1) verify compliance with this APA as to the Covered Issue(s), or (2) audit
issues other than Covered Issue(s), including issues that arise under Code section 482 and any other Code sections identified in Ap-
pendix A to this APA, and the U.S. Treasury Regulations thereunder.
LIMITATION ON ASSISTANCE
The Covered Issue(s) may relate to one or more countries which (i) have an income tax convention with the United States, but
(ii) are not a party to a mutual agreement whose terms are implemented by this APA. U.S. Taxpayer acknowledges that the IRS may
decline to provide competent authority assistance concerning taxation by such country(ies) that relates to the Covered Issue(s). See
section 2.02(4)(d) of Rev. Proc. 2015-41.
AGREEMENT
The Parties agree as follows:
1. Covered Entities. This APA’s Covered Entities are defined in Appendix A.
2. Covered Issue(s). This APA applies to the Covered Issue(s), as defined in Appendix A.
3. Covered Method(s). Appendix A sets forth the Covered Method(s) for the Covered Issue(s).
4. Term. This APA applies to the APA Term, as defined in Appendix A.
5. Operation.
a. Rev. Proc. 2015-41 governs the interpretation, legal effect, and administration of this APA.
b. The APMA program provides a voluntary process whereby the IRS and taxpayers may resolve transfer pricing issues
and issues for which transfer pricing principles may be relevant in a principled and cooperative manner on a prospective
basis. As such, the APA process (as defined in Rev. Proc. 2015-41) is an alternative to dispute resolution that benefits
both taxpayers and the IRS and that is intended to promote and encourage open communication. Accordingly, the IRS
and U.S. Taxpayer agree that neither party will attempt to use nonfactual oral or written representations, within the
meaning of sections 6.04 and 6.05 of IRS Revenue Procedure 2015-41 (including any proposals to use particular Cov-
ered Method(s)), made in conjunction with the APA Request in any judicial or administrative proceeding. The IRS and
U.S. Taxpayer also agree that factual representations made in conjunction with the APA Request may be used in judicial
and administrative proceedings.
6. Compliance.
a. U.S. Taxpayer must report its taxable income in an amount that is consistent with Appendix A and all other requirements
of this APA. U.S. Taxpayer must so report its taxable income in the following manner:
i. For any APA Tax Year for which U.S. Taxpayer timely files its original U.S. return prior to, or no later than 60 days after, the
U.S. Effective Date, U.S. Taxpayer must so report its taxable income for that APA Tax Year in one of the following ways:
A. on such original U.S. return;

Bulletin No. 2020–15 637 April 6, 2020
B. on an amended U.S. return submitted no later than 120 days after the U.S. Effective Date;
C. through a means proposed by U.S. Taxpayer and accepted by the applicable IRS practice area no later than 120 days
after the U.S. Effective Date (or by such other deadline as is agreed between U.S. Taxpayer and the applicable IRS
practice area); or
D. if applicable:
[]* no later than 120 days after the U.S. Effective Date through the following means: #DESCRIPTION OF MEANS.
ii. For all other APA Tax Years, U.S. Taxpayer must so report its taxable income on its timely filed original U.S. return.
iii. The provisions of paragraphs 6(a)(i) and 6(a)(ii) are modified by this paragraph 6(a)(iii). If a Covered Method includes a
term test (including the case of an annual test with a supplemental term test) or a subterm test, as described in section 4 of
Appendix A, then the APA Covered Year as of which the term test or subterm test applies would change in the event of an
Early Termination. Specifically, while in the absence of an Early Termination a term test would apply as of the last APA
Covered Year, in the event of an Early Termination the term test would apply as of an earlier APA Covered Year. Similarly,
while in the absence of an Early Termination a subterm test would apply as of the last APA Covered Year in the subterm, in
the event of an Early Termination the subterm test might apply as of an earlier APA Covered Year. In these situations, the
Early Termination might not be established in time for U.S. Taxpayer to know to apply the term test or subterm test as of the
earlier APA Covered Year in reporting taxable income as required under paragraphs 6(a)(i) and 6(a)(ii) for the APA Tax Year
corresponding to that earlier APA Covered Year. In such cases, U.S. Taxpayer may need to correct its reporting for that APA
Tax Year. Specifically, U.S. Taxpayer will need to correct its income reporting for that APA Tax Year if the application of the
term test or subterm test in that earlier APA Covered Year changes the existence or amount of an APA Primary Adjustment
for the Covered Method for that APA Tax Year. In such cases:
A) The resulting incorrectness in the prior reporting for that APA Tax Year is excused; and
B) U.S. Taxpayer must correct such prior reporting through a means listed in paragraph 6(a)(i) within 120 days of the Early
Termination being established.
b. For each Covered Issue, if any, that involves determination of pricing and/or income allocation
16
under Code section 482 (or
Code section 367(d)) as modified by any applicable income tax convention, this APA addresses the pricing and/or income allocation
between U.S. Taxpayer and Non-U.S. Taxpayer in the aggregate. Except as explicitly provided, this APA does not address and does
not bind the IRS with respect to pricing or income allocation (1) among particular legal entities that are members of U.S. Taxpayer, or
(2) among particular legal entities that are members of Non-U.S. Taxpayer. In addition, this APA does not address pricing or income
allocation between an entity that is not a Covered Entity, and any entity.
c. For each APA Tax Year, if U.S. Taxpayer complies with the terms and conditions of this APA, then, provided that this APA re-
mains effective for that APA Tax Year for a particular Covered Issue, the IRS will not make or propose any allocation or adjustment
that is inconsistent with the application under this APA of the applicable Covered Method to that Covered Issue.
d. If U.S. Taxpayer does not comply with the terms and conditions of this APA, then the IRS may:
i. enforce the terms and conditions of this APA and make or propose allocations or adjustments based on the application of the
Covered Method(s) to the Covered Issue(s) as provided in this APA;
ii. cancel or revoke this APA under section 7.06 of Rev. Proc. 2015-41; or
iii. revise this APA, if the Parties agree.
e. U.S. Taxpayer must timely file an Annual Report for each APA Tax Year in accordance with this paragraph 6(e), Appendix C
to this APA, and section 7.02 of Rev. Proc. 2015-41. Annual Reports for multiple APA Tax Years may be combined, provided that
all required information for each APA Tax Year is clearly presented. For each Annual Report, U.S. Taxpayer must submit an original
printed version containing a signed original “penalties of perjury” declaration, one printed copy of the contents of the original printed
version, and an electronic copy of the contents of the original printed version. Any exhibits in the printed version must be tabbed,
and the electronic copy is subject to the same requirements, as to medium and format, that are specified for APA requests in section
2 of the Appendix to Rev. Proc. 2015-41. Upon request, U.S. Taxpayer must provide additional copies of the printed version, at ad-
dresses specified by the IRS. U.S. Taxpayer must file the Annual Report for each APA Tax Year by the later of (i) #DATE CERTAIN,
NORMALLY APPROXIMATELY 90 DAYS AFTER THE U.S. EFFECTIVE DATE, and (ii) the fifteenth day of the twelfth month
following the close of the APA Tax Year. The IRS may by notice request additional information reasonably necessary to clarify or
complete the Annual Report. (See paragraph 16, and section 3(c) of Appendix C, regarding notices.) U.S. Taxpayer will provide such
16
As used in this APA, "income allocation" includes allocation of loss.

April 6, 2020 638 Bulletin No. 2020–15
requested information within 30 days from the date of the notice unless a later date is specified in the notice. Additional time may be
allowed for good cause in the discretion of the Director of the Advance Pricing and Mutual Agreement Program.
f. The IRS will determine whether U.S. Taxpayer has complied with this APA based on U.S. Taxpayer’s U.S. returns, the Financial
Statements and additional statements required under this paragraph 6(f), and other APA Records, for all APA Tax Years and any other
tax year necessary to verify compliance. The Financial Statements and additional statements required for a particular tax year are:
[] For every U.S. Covered Entity, the Financial Statements together with the additional statements specified in paragraph
6(f)(i); and for every Non-U.S. Covered Entity, the Financial Statements together with the additional statements speci-
fied in paragraph 6(f)(ii).
[]* For every U.S. Covered Entity, the Financial Statements together with the additional statements specified in paragraph
6(f)(i).
[]* For every Non-U.S. Covered Entity, the Financial Statements together with the additional statements specified in para-
graph 6(f)(ii).
i. For each U.S. Covered Entity, the additional statements consist of the following statement(s):
[] An audit opinion for that U.S. Covered Entity’s Financial Statements, as defined in paragraph 6(f)(iii).
[]* One or more of the following, as indicated:
[] An accountant’s report for that U.S. Covered Entity’s Financial Statements, as defined in paragraph 6(f)(iii).
[] A self-certification for that U.S. Covered Entity’s Financial Statements, as defined in paragraph 6(f)(iii).
[] A self-certification for that U.S. Covered Entity’s Financial Statements, together with a tying certification for that
entity’s Financial Statements, as defined in paragraph 6(f)(iii).
[] #OTHER MEANS OF VERIFYING THE RELIABILITY OF THE U.S. COVERED ENTITY’S FINANCIAL
STATEMENTS.
ii. For each Non-U.S. Covered Entity, the additional statements consist of the following statement(s):
[] An audit opinion for that Non-U.S. Covered Entity’s Financial Statements, as defined in paragraph 6(f)(iii).
[]* One or more of the following, as indicated:
[] An accountant’s report for that Non-U.S. Covered Entity’s Financial Statements, as defined in paragraph 6(f)(iii).
[] A self-certification for that Non-U.S. Covered Entity’s Financial Statements, as defined in paragraph 6(f)(iii).
[] A self-certification for that Non-U.S. Covered Entity’s Financial Statements, together with a tying certification for
that Covered Entity’s Financial Statements, as defined in paragraph 6(f)(iii).
[] #OTHER MEANS OF VERIFYING THE RELIABILITY OF THE NON-U.S. COVERED ENTITY’S FINAN-
CIAL STATEMENTS.
iii. With reference to the Financial Statements for a particular Covered Entity for a particular tax year, certain terms used in
paragraphs 6(f)(i) and 6(f)(ii) are defined as follows:
A. An audit opinion is an opinion of an independent certified public or chartered accountant who audited the Financial
Statements.
B. An accountant’s report is a report of an independent certified public or chartered accountant who is associated with the
Financial Statements.
C. A self-certification is an attestation, as defined in paragraph 6(f)(iii)(E), that the Financial Statements have been pre-
pared according to the Applicable Accounting Standard.
D. A tying certification consists of the following:
(1) An attestation, as defined in paragraph 6(f)(iii)(E), that the Financial Statements can be reconciled to the consol-
idated Financial Statements for that entity’s direct or indirect parent according to workpapers provided with the
attestation;
(2) The workpapers referred to in paragraph 6(f)(iii)(D)(1), which must demonstrate the consolidation of the Covered
Entity’s Financial Statements into the Financial Statements of the parent referred to in paragraph 6(f)(iii)(D)(1);

Bulletin No. 2020–15 639 April 6, 2020
(3) The Financial Statements of the parent referred to in paragraph 6(f)(iii)(D)(1); and
(4) An audit opinion (as defined in paragraph 6(f)(iii)(A)) for the Financial Statements of the parent referred to in
paragraph 6(f)(iii)(D)(1).
E. An attestation is an affirmation by an officer of the Covered Entity in the following form:
I, [Officer’s Name and Title], of [Name of Covered Entity] affirm under penalties of perjury that the facts stated
below are true. I either have adequate first-hand knowledge to make this affirmation or have gained adequate
knowledge to make this affirmation through diligent consultation(s) with one or more individuals who have first-
hand knowledge.
[Facts attested to.]
[Signature]
g. In accordance with section 7.04 of Rev. Proc. 2015-41, U.S. Taxpayer will (1) maintain the APA Records, and (2) make them
available to the IRS in connection with an examination under section 7.03 of Rev. Proc. 2015-41. Compliance with this subparagraph
constitutes compliance with the record-maintenance provisions of Code sections 6038A and 6038C for the Covered Issue(s) for any
APA Covered Year.
h. The “true taxable income” within the meaning of U.S. Treasury Regulations sections 1.482-1(a)(1) and (i)(9) of a member of an
affiliated group filing a U.S. consolidated return will be determined under the U.S. Treasury Regulations under Code section 1502.
i. T
o the extent that U.S. Taxpayer’s compliance with this APA depends on certain acts of other members of Worldwide Group,
U.S. Taxpayer will ensure that such other members will perform such acts.
7. Critical Assumptions. The Critical Assumptions, which are this APA’s critical assumptions as defined in Rev. Proc. 2015-41,
appear in Appendix B. If any Critical Assumption has not been met, then Rev. Proc. 2015-41, section 7.06, governs, as modified by
Appendix B to this APA.
8. Disclosure. This APA, and any background information related to this APA or the APA Request, are: (1) considered “return
information” under Code section 6103(b)(2)(C); and (2) not subject to public inspection as a “written determination” under Code
section 6110(b)(1). Section 521(b) of Pub. L. 106-170 provides that the Secretary of the Treasury must prepare a report for public
disclosure that includes certain specifically designated information concerning all APAs, including this APA, in a form that does not
reveal taxpayers’ identities, trade secrets, and proprietary or confidential business or financial information.
9. Disputes. If a dispute arises concerning the interpretation or application of this APA, the Parties will seek a resolution by the
Director, Treaty and Transfer Pricing Operations, to the extent reasonably practicable, before seeking alternative remedies.
10. Materiality. In this APA the terms “material” and “materially” will be interpreted in a manner consistent with the description
of “material facts” in Rev. Proc. 2015-41, section 7.06(4).
11. Paragraph Captions. This APA’s paragraph captions, which appear in italic type, are for convenience and reference only. The
captions do not affect in any way the interpretation or application of this APA.
12. Terms and Definitions.
a. Unless otherwise specified, terms in the plural include the singular and vice versa.
b. Appendix A contains definitions for certain terms used in this APA’s body and appendices.
c. Certain terms used in this APA’s body and appendices are defined as follows:
TermDefinition
Annual ReportA report within the meaning of Rev. Proc. 2015-41, section 7.02.
Advance Pricing
Agreement, or “APA”
An “advance pricing agreement” within the meaning of Rev. Proc. 2015-41, section 2.02.
Unless context indicates otherwise, “this APA” or “the APA” denotes the particular APA that
is executed below.
APA Records(Defined in Appendix C.)
APA RequestU.S. Taxpayer’s request for this APA, which was dated #DATE, including any amendments or
supplemental or additional information thereto (including but not limited to any responses to
due diligence questions).
Critical Assumptions(Defined in paragraph 7.)

April 6, 2020 640 Bulletin No. 2020–15
TermDefinition
Financial StatementsBalance sheet, income statement, statement of cash flow, and explanatory notes, prepared in
accordance with the Applicable Accounting Standard as defined in section 7 of Appendix A.
Non-U.S. GroupIn any APA Tax Year, Worldwide Group members that are not U.S. persons.
Parties(Defined in the Recitals near the start of this APA.)
Pub. L. 106-170The Ticket to Work and Work Incentives Improvement Act of 1999.
U.S. Effective Date(Defined in paragraph 17 and in section 7 of Appendix A. Those definitions are intended to
have the same meaning. In case of conflict, the definition in paragraph 17 controls.)
U.S. GroupIn any APA Tax Year, Worldwide Group members that are U.S. persons.
Worldwide GroupIn any APA Tax Year, U.S. Taxpayer and all organizations, trades, businesses, entities, or
branches (whether or not incorporated, organized in the United States, or affiliated) owned or
controlled directly or indirectly by the same interests.
13. Deadline References. If a deadline under this APA falls on a Saturday, Sunday, or a legal holiday in the District of Columbia,
the deadline is extended to the next succeeding day that is not a Saturday, Sunday, or legal holiday in the District of Columbia.
14. Entire Agreement and Severability. This APA is the complete statement of the Parties’ agreement. The Parties will sever, delete,
or reform any invalid or unenforceable provision in this APA to approximate the Parties’ intent as nearly as possible.
15. Successor in Interest. This APA binds, and inures to the benefit of, any successor in interest to U.S. Taxpayer.
16. Notice. Any notices required by this APA or Rev. Proc. 2015-41 must be in writing. U.S. Taxpayer will send notices to the IRS
at:
Commissioner, Large Business and International Division
Internal Revenue Service
1111 Constitution Avenue, NW
SE:LB:TTPO:APMA:NCA534-01
Washington, DC 20224
(Attention: APMA)
The IRS will send notices to:
#NAME AND ADDRESS
(phone: #PHONE)
The IRS also will send notices to, if applicable:
[] #REPRESENTATIVE’S NAME AND ADDRESS
(phone: #PHONE)
provided that a valid IRS Form 2848 “Power of Attorney and Declaration of Representative” for that person was included in the
most recent Annual Report (or, if no Annual Report has been filed, was included in the APA Request).
17. U.S. Effective Date and Counterparts. This APA is effective starting on the date, or later date of the dates, upon which all Par-
ties execute this APA (“U.S. Effective Date”). The Parties may execute this APA in counterparts, with each counterpart constituting
an original.
WITNESS,
The Parties have executed this APA on the dates below.
#SIGNATORY NAME IN BOLD FACE BLOCK CAPITAL LETTERS
By: __________________________Date: _________________, 20____
#NAME
#TITLE
INTERNAL REVENUE SERVICE
By: __________________________Date: _________________, 20____
John C. C. Hughes
Director, Advance Pricing and Mutual Agreement Program

Bulletin No. 2020–15 641 April 6, 2020
APPENDIX A
COVERED ENTITIES, TERM, COVERED ISSUE(S), COVERED METHOD(S), INCOME REPORTING,
CONFORMING ADJUSTMENTS AND REPATRITION OF FUNDS,
CERTAIN SUBSEQUENT ADJUSTMENTS,
AND DEFINITIONS
Section 1 of this Appendix lists the Covered Entities. Section 2 defines the APA Term, APA Tax Years, and APA Covered Years.
Section 3 describes the Covered Issue(s). Section 4 describes the Covered Method applicable to each Covered Issue.
Section 5 describes the application of the Covered Method(s) to income reporting and the possible need for an APA Primary Ad-
justment under one or more Covered Methods. Section 6 addresses conforming adjustments and repatriation of funds following APA
Primary Adjustments.
Section 7 provides definitions that apply both to this Appendix and to the APA as a whole. The definitions table is based on a stan-
dard, inclusive model, and thus may include terms not used in this APA.
1. Covered Entities
The U.S. Covered Entity(ies) are:
#LIST OF EACH U.S. ENTITY INVOLVED IN ONE OR MORE COVERED ISSUE(S), AND ALSO (LISTED FIRST) ANY
CONSOLIDATED RETURN PARENT FOR ANY SUCH ENTITY. FOR EACH ENTITY, NAME, ADDRESS, PHONE, AND EIN.
The term “U.S. Taxpayer” includes collectively all U.S. Covered Entities and any other entities that are in a consolidated return
group with a U.S. Covered Entity.
The Non-U.S. Covered Entity(ies) are:
# LIST OF EACH NON-U.S. ENTITY INVOLVED IN ONE OR MORE COVERED ISSUE(S), AND ALSO (LISTED
FIRST) ANY COMMON TAX REPORTING PARENT FOR ANY SUCH ENTITY. FOR EACH ENTITY, NAME, AD-
DRESS, AND PHONE.
The term “Non-U.S. Taxpayer” includes collectively all Non-U.S. Covered Entities and any other entities that are in a common tax
reporting group with a Non-U.S. Covered Entity.
The term “Covered Entities” includes both the U.S. Covered Entities and the Non-U.S. Covered Entities.
2. APA Term, APA Tax Years, and APA Covered Years
The APA applies to the period from #DATE to #DATE, inclusive (the “APA Term”).
[] The APA Term does not include a Rollback.
[] The APA Term includes a Rollback, which covers from #DATE to #DATE, inclusive (the “Rollback Period”).
A tax year of U.S. Taxpayer that is wholly or partly contained in the APA Term is called an “APA Tax Year.” For a particular APA
Tax Year, the portion of such APA Tax Year that is contained in the APA Term is called an “APA Covered Year.” Such APA Tax Year
and APA Covered Year are said to “correspond” to each other or to be “corresponding.”
3. Covered Issue(s)
The Covered Issue(s) are as described below.
Covered Issue 1:
#DESCRIPTION OF COVERED ISSUE.
4. Covered Method(s)
Each Covered Method applies to one or more Covered Issues. A Covered Method and the Covered Issue(s) to which the Covered
Method applies are said to “correspond,” or to be “corresponding”.
The Covered Methods are summarized in the following table and are described in detail below. In case of conflict with this table,
the detailed descriptions of the Covered Methods below, and the descriptions in section 3 above of the Covered Issues, control.

April 6, 2020 642 Bulletin No. 2020–15
Covered Method
Number
Applies to Covered
Issues Number(s)
Summary Description of
Corresponding Covered
Issues
Type of Method;
Results Tested
Point or
Range
Testing Frequency
and Periods
1
This Appendix A uses the term “Tested Party.” When applied in the context of methods that consider, or test, data from only one
party to a transaction, this term is similar in concept to the term “tested party” as discussed in the OECD Guidelines paragraphs 3.18
and 3.19, and as defined in the U.S. Treasury Regulations section 1.482-5(b)(2). However, some methods consider, or test, data from
both parties to a transaction, where there is no singular “tested” party. Even in applying such methods, however, it is typically the
case that one particular party’s results are formally tested for compliance with the method. For purposes of this template, in such
circumstances, the party whose results are formally tested in applying any particular method is the “Tested Party”, even if that party
is not strictly a “tested party” as discussed in the OECD Guidelines paragraphs 3.18 and 3.19, or as defined in the U.S. Treasury
Regulations section 1.482-5(b)(2).
Covered Method for Covered Issue 1:
a. Tested Party
The Tested Party is #TESTED PARTY.
b. Financial Results Tested (Type of Method)
[] The Covered Method is an implementation of the comparable uncontrolled price method under the OECD Guidelines and
of the comparable uncontrolled price method under the U.S. Treasury Regulations. The Tested Party’s financial results to be
tested are:
[] per unit price paid, defined as the total amount paid for #DESCRIPTION OF GOODS divided by the number of #DE-
SCRIPTION OF A UNIT OF GOODS purchased.
[] per unit price received, defined as the total amount received for #DESCRIPTION OF GOODS divided by the number
of #DESCRIPTION OF A UNIT OF GOODS sold.
[] The Covered Method is an implementation of the comparable uncontrolled price method under the OECD Guidelines and of
the comparable uncontrolled services price method under the U.S. Treasury Regulations. The Tested Party’s financial results
to be tested are:
[] per unit price paid, defined as the total amount paid for #DESCRIPTION OF SERVICES divided by the number of
#DESCRIPTION OF A UNIT OF SERVICES received.
[] per unit price received, defined as the total amount received for #DESCRIPTION OF SERVICES divided by the number
of #DESCRIPTION OF A UNIT OF SERVICES provided.
[] The Covered Method is an implementation of the comparable uncontrolled price method under the OECD Guidelines and
of the comparable uncontrolled transaction method under the U.S. Treasury Regulations. The Tested Party’s financial results
to be tested are the royalty paid for the license of #DESCRIPTION OF LICENSED INTANGIBLE PROPERTY divided by
the Tested Party’s:
[] sales revenue from sales of #DESCRIPTION OF GOODS/SERVICES.
[] #OTHER ROYALTY BASE.
[] The Covered Method is an implementation of the comparable uncontrolled price method under the OECD Guidelines and
of the acquisition price method under the U.S. Treasury Regulations. The Tested Party’s financial results to be tested are
described in subsection (c) below.
[] The Covered Method is an implementation of the comparable uncontrolled price method under the OECD Guidelines and
of the market capitalization method under the U.S. Treasury Regulations. The Tested Party’s financial results to be tested are
described in subsection (c) below.
[] The Covered Method is an implementation of the resale price method under the OECD Guidelines and of the resale price
method under the U.S. Treasury Regulations. The Tested Party’s financial results to be tested are the gross profit margin from
the sale of #DESCRIPTION OF GOODS.

Bulletin No. 2020–15 643 April 6, 2020
[] The Covered Method is an implementation of the resale price method under the OECD Guidelines and of the gross services
margin method under the U.S. Treasury Regulations. The Tested Party’s financial results to be tested are the gross services
margin from the provision of #DESCRIPTION OF SERVICES.
[] The Covered Method is an implementation of the cost plus method under the OECD Guidelines and of the cost plus method
under the U.S. Treasury Regulations. The Tested Party’s financial results to be tested are the gross profit markup.
[] The Covered Method is an implementation of the cost plus method under the OECD Guidelines and of the cost of services
plus method under the U.S. Treasury Regulations. The Tested Party’s financial results to be tested are the gross services
profit markup from the provision of #DESCRIPTION OF SERVICES.
[] The Covered Method is based on the principles of the low value-adding intra-group services approach under the OECD
Guidelines and of the services cost method under the U.S. Treasury Regulations. The Tested Party’s financial results to be
tested are the markup on total costs for providing #DESCRIPTION OF SERVICES.
[] The Covered Method is an implementation of the transactional net margin method under the OECD Guidelines and of the
comparable profits method under the U.S. Treasury Regulations. The Tested Party’s financial results to be tested, as reflected
in its net profit indicator (per OECD Guidelines) or profit level indicator (per U.S. Treasury Regulations), are its:
[] operating margin.
[] markup on total costs.
[] Berry ratio.
[] return on operating assets.
[] return on invested capital.
[]* #OTHER NET PROFIT INDICATOR OR PROFIT LEVEL INDICATOR, WITH DEFINITION.
[] The Covered Method is an implementation of the profit split (residual analysis) method under the OECD Guidelines and
of the residual profit split method under the U.S. Treasury Regulations. The Tested Party’s financial results to be tested are
described in subsection (c) below.
[] The Covered Method is an implementation of the profit split (contribution analysis) method under the OECD Guidelines and
of the comparable profit split method under the U.S. Treasury Regulations. The Tested Party’s financial results to be tested
are described in subsection (c) below.
[] The Covered Method is an implementation of an income based valuation technique as referenced in paragraph 6.153 of the
OECD Guidelines and of the income method under the U.S. Treasury Regulations. The Tested Party’s financial results to be
tested are described in subsection (c) below.
[] The Covered Method is an implementation of (i) a sharing of the cost of current contributions in proportion to overall
expected benefits, within a cost contribution arrangement under the OECD Guidelines, and (ii) a sharing of intangible de-
velopment costs in proportion to reasonably anticipated benefits, within a cost sharing arrangement under the U.S. Treasury
Regulations. The Tested Party’s financial results to be tested are described in subsection (c) below.
[] The Covered Method is a method that is not specified under the OECD Guidelines and not specified under the U.S. Treasury
Regulations. The Tested Party’s financial results to be tested are described in subsection (c) below.
Such financial results are determined according to the Applicable Accounting Standard, with the proviso that in determining such
results, accounting principles and conventions that are generally accepted in the trade or industry must be used.
Such financial results are tested against a point or range as described below. The test is carried out with a frequency, and for cer-
tain time periods, as described below. If and when these financial results do not satisfy the test, they must be adjusted as described in
section 5 of this Appendix A.
c. Testing of Financial Results Against a Point or Range
The Tested Party’s financial results are tested as follows:
[] The financial results must equal #X.
[] The financial results must be within an Arm’s Length Range.
[] The Arm’s Length Range is from #X to #Y inclusive.

April 6, 2020 644 Bulletin No. 2020–15
[] This Arm’s Length Range has an associated Median value of #Z.
[] This Arm’s Length Range has no associated Median value.
[] Two Arm’s Length Ranges apply. The first is from #W to #X inclusive and applies to the annual test described in sub-
section (d) below. The second is from #Y to #Z inclusive and applies to the term test described in subsection (d) below.
[] The first Arm’s Length Range has an associated Median value of #P, and the second Arm’s Length Range has an
associated Median value of #Q.
[] These Arm’s Length Ranges have no associated Median value.
[] Two Arm’s Length Ranges apply. The first is from #W to #X inclusive and applies to the subterm test described in
subsection (d) below. The second is from #Y to #Z inclusive and applies to the annual test described in subsection (d)
below.
[] The first Arm’s Length Range has an associated Median value of #P, and the second Arm’s Length Range has an
associated Median value of #Q.
[] These Arm’s Length Ranges have no associated Median value.
[] Two Arm’s Length Ranges apply. The first is from #W to #X inclusive and applies to the test for the first subterm de-
scribed in subsection (d) below. The second is from #Y to #Z inclusive and applies to the test for the second subterm
described in subsection (d) below.
[] The first Arm’s Length Range has an associated Median value of #P, and the second Arm’s Length Range has an
associated Median value of #Q.
[] These Arm’s Length Ranges have no associated Median value.
[] #OTHER DESCRIPTION, FOR EXAMPLE THE EVALUATION AND TESTING MECHANICS FOR A PROFIT SPLIT,
AN INCOME METHOD, AN UNSPECIFIED METHOD, OR A SHARING OF COSTS UNDER A COST CONTRIBU-
TION ARRANGMENT/COST SHARING ARRANGEMENT.
d. Testing Frequency and Testing Periods
The Tested Party’s financial results are tested as of certain APA Covered Years, and for certain time periods, as follows:
[] The results are tested annually, meaning that they are tested as of each APA Covered Year, for a period consisting of that APA
Covered Year.
[] There is no additional term test.
[] There is an additional term test. For this test, the results are tested as of the Last Effective APA Covered Year, for the
period consisting of the Last Effective APA Covered Year and all prior APA Covered Years.
The application of the annual test and the application of the additional term test are coordinated as described in section 5 of this
Appendix A.
[]* The results are tested on a term basis, meaning that they are tested only once, as of the Last Effective APA Covered Year, for
a period consisting of the Last Effective APA Covered Year and all prior APA Covered Years.
[]* The results are tested on the basis of two subterms. For this purpose, the APA Term is divided into two subterms. The first
subterm consists of all APA Covered Years ending on or before #DATE, and the second subterm consists of all other APA
Covered Years. For each subterm, the results are tested as of the Last Effective APA Subterm Covered Year, for a period
consisting of the Last Effective APA Subterm Covered Year and all prior APA Covered Years in the subterm.
[]* The results are tested on a subterm basis for all APA Covered Years ending on or before #DATE (the “subterm”), and are
tested annually for each other APA Covered Year, as follows:
The results are tested as of the Last Effective APA Subterm Covered Year, for a period consisting of the Last Effective APA Sub-
term Covered Year and all prior APA Covered Years in the subterm.
The results are tested as of each APA Covered Year that is not in the subterm, for a period consisting of that APA Covered Year.
[]* The results are tested on a cumulative basis, meaning that (except as provided in the following sentence) they are not tested
as of the first APA Covered Year but they are tested as of each other particular APA Covered Year for a period consisting of
such particular APA Covered Year and all prior APA Covered Years. However, if the Last Effective APA Covered Year is

Bulletin No. 2020–15 645 April 6, 2020
the first APA Covered Year, then the results are tested as of the first APA Covered Year, for a period consisting of such APA
Covered Year.
[]* The results are tested on a three-year rolling average basis, meaning that the results are tested as of each APA Covered Year,
for a period consisting of the APA Tax Year corresponding to the APA Covered Year (but excluding any portion of that APA
Tax Year that is after the APA Term), and the Tested Party’s two preceding tax years.
e. Other Provisions
The Tested Party’s financial results, to be tested as described above, are for:
[] The Tested Party as a whole.
[] Only a segment of the Tested Party’s activity. #DETAILED DESCRIPTION OF THE SEGMENT AND OF THE ALLO-
CATION AND APPORTIONMENT METHODS USED, INCLUDING ANY APPLICABLE FORMULAS AND DEFINI-
TIONS OF QUANTITIES USED IN THOSE FORMULAS. THIS DESCRIPTION SHOULD BE DETAILED ENOUGH
TO ENABLE A STRAIGHTFORWARD VERIFICATION OF COMPLIANCE BY THE IRS EXAMINATION TEAM.
When the Tested Party’s financial results are tested as of a given APA Covered Year, those results shall reflect, to the extent rele-
vant, any APA Primary Adjustment for this Covered Method made under section 5 of this Appendix A for the APA Tax Year corre-
sponding to any prior APA Covered Year.
For this Covered Method, if applicable:
[]* For APA Covered Years ending on or before #DATE, it is agreed that this Covered Method, yields financial results as shown
below, and that any APA Primary Adjustments under section 5 of this Appendix A are as shown below. #TEXT AND/OR
TABLES SHOWING THE FINANCIAL RESULTS, THE TESTING OF THOSE FINANCIAL RESULTS UNDER THE
COVERED METHOD, AND ANY RESULTING APA PRIMARY ADJUSTMENTS.
For this Covered Method, if applicable:
[] This Covered Method addresses the pricing for a transfer of intangible property (which does not constitute a platform con-
tribution transaction as defined in U.S. Treasury Regulations section 1.482-7(b)(1)(ii)) within the meaning of U.S. Treasury
Regulations section 1.482-4. That pricing will not be subject to periodic adjustments by the IRS, during or after the APA
Term, under U.S. Treasury Regulations section 1.482-4(f)(2) or (6).
[] This Covered Method addresses the pricing for a platform contribution transaction (“PCT”). That PCT will not be treated
as a Trigger PCT within the meaning of U.S. Treasury Regulations section 1.482-7(i)(6)(i) for purposes of making periodic
adjustments, during or after the APA Term, under U.S. Treasury Regulations section 1.482-7(i)(6).
5. Application of Covered Method(s) to Income Reporting
For each APA Tax Year, and for each Covered Method and corresponding Covered Issue(s), the amounts reported by U.S. Taxpay-
er and Non-U.S. Taxpayer for income tax purposes under the laws of the United States and #COUNTRY(IES) must clearly reflect
the Tested Party’s actual transactions, allocations, and/or recordkeeping, as applicable, that relate to such Covered Issue(s), adjusted
as necessary to conform with section 4 of this Appendix A. Accordingly, for each particular APA Tax Year and corresponding APA
Covered Year, and for each such Covered Method:
i. If the Tested Party’s financial results are tested as of such APA Covered Year and do not conform with section 4 of this
Appendix A, then the tax reporting for such APA Tax Year must clearly reflect an adjustment that brings such results into
conformance (an “APA Primary Adjustment”). If section 4 of this Appendix A specifies conformance to an Arm’s Length
Range, then the adjustment shall be to:
[] the Median.
[]* the near edge of the Arm’s Length Range.
[]* the Median for Covered Issues #SPECIFY WHICH ONES, and the near edge of the Arm’s Length Range for Covered
Issues #SPECIFY WHICH ONES.
ii. If an adjustment is not required under paragraph (i) above, then the tax reporting must clearly reflect the Tested Party’s fi-
nancial results, with no adjustment. In this case there is no APA Primary Adjustment.
iii. If both an annual test and an additional term test apply under such Covered Method, and such APA Covered Year is the Last
Effective APA Covered Year, so that as of such APA Covered Year the Tested Party’s financial results are tested under both
the annual test and the term test, then paragraphs (i) and (ii) above are modified by this paragraph (iii), which coordinates

April 6, 2020 646 Bulletin No. 2020–15
the application of both tests. As explained in more detail below, the annual test is applied first, followed by the term test.
Specifically, the need for and amount of any APA Primary Adjustment for such APA Covered Year will be determined as
follows:
A. First apply paragraphs (i) and (ii) above under the assumption that only the annual test applies. Any required adjustment
will be referred to as the “annual adjustment” rather than an “APA Primary Adjustment.” If there is no required adjust-
ment, the annual adjustment is considered to be zero.
B. Next, apply paragraphs (i) and (ii) above to the Tested Party’s financial results as adjusted by any nonzero annual adjust-
ment, under the assumption that only the term test applies to those results. Any required adjustment under this applica-
tion of paragraphs (i) and (ii) will be referred to as the “term adjustment” rather than an “APA Primary Adjustment.” If
there is no such required adjustment, the term adjustment is considered to be zero.
C. Add the annual adjustment and term adjustment, taking account of the magnitude and (if nonzero) direction of each. If
this sum is zero, there is no APA Primary Adjustment for such APA Covered Year. If this sum is nonzero, this sum gives
the magnitude and direction of the APA Primary Adjustment for such APA Covered Year. Any APA Primary Adjustment,
or the lack of an APA Primary Adjustment, must be clearly reflected in the tax reporting for such APA Tax Year (see
paragraphs (i) and (ii) above).
iv. If this APA is unilateral and such APA Covered Year is within the Rollback Period, then:
[] Paragraphs (i)-(iii) above notwithstanding, an APA Primary Adjustment will not be made if that APA Primary Adjust-
ment would decrease the income of U.S. Taxpayer for such APA Tax Year.
[]* Paragraphs (i)-(iii) above apply without modification.
If indicated, the above provisions on APA Primary Adjustments are modified as follows:
[]* Any APA Primary Adjustment that would be made under the above provisions for an APA Tax Year ending before #DATE
will instead be made for the APA Tax Year ending #THE SAME DATE (the “Telescoping Year”). For each particular Cov-
ered Method, all APA Primary Adjustments that are made for the Telescoping Year (including any APA Primary Adjustments
that are moved to the Telescoping Year as just described, as well as any APA Primary Adjustment originally made for the
Telescoping Year) are netted.
[] The foregoing provision applies without modification.
[] The foregoing provision applies with the following modification. An APA Primary Adjustment that is thus moved from
a particular APA Tax Year (the “Original Year”) to the Telescoping Year shall be increased in amount to reflect the time
value of money. That increase will consist of multiplication by a factor that is an annual rate raised to a power. The
annual rate is 1.#XY. The power is the quotient of (i) the average of the number of months by which the end of the Tele-
scoping Year is later than the end of the Original Year, and the number of months by which the start of the Telescoping
Year is later than the start of the Original Year (with any fractions of months rounded to whole months), (ii) divided by
twelve.
For U.S. tax purposes, the generally applicable Code rules will apply with respect to APA Primary Adjustments, except as other-
wise provided in Rev. Proc. 2015-41 or in this APA.
6.Conforming Adjustments and Repatriation of Funds
The provisions in this section 6 apply to “Repatriable Issues,” which are Covered Issues that concern transactions between associ-
ated enterprises that fall under Article 9 of the OECD Model Tax Convention. Such transactions correspond to transactions that under
U.S. law are subject to application of Code section 482, as modified by any applicable treaty provision.
If the application of a Covered Method to a Repatriable Issue requires an APA Primary Adjustment under section 5 of this Ap-
pendix A for a given APA Tax Year, then for U.S. tax purposes there generally must be a corresponding conforming adjustment as
specified in U.S. Treasury Regulations section 1.482-1(g)(3) as amplified by Rev. Proc. 99-32 or any successor revenue procedure.
However, for this purpose, all APA Primary Adjustments for such APA Tax Year arising from the application of a Covered Method
to a Repatriable Issue are first netted to yield a net APA Primary Adjustment for such APA Tax Year. Only if the net APA Primary
Adjustment is nonzero is a conforming adjustment required.
For each APA Tax Year with a nonzero net APA Primary Adjustment, for U.S. tax purposes the conforming adjustment will be
accomplished in the following steps:
i. The conforming adjustment will be accomplished between #U.S. ENTITY and #NON-U.S. ENTITY, which will be referred
to here as “U.S. Entity” and “Non-U.S. Entity”, respectively. An intercompany payable will be established between U.S.

Bulletin No. 2020–15 647 April 6, 2020
Entity and Non-U.S. Entity in the amount and direction of the net APA Primary Adjustment, as of the last day of such APA
Tax Year. This payable will be denominated in #CURRENCY. The payable will be treated as indebtedness for all U.S. fed-
eral tax purposes; provided, however, that the payable will not be treated as indebtedness for purposes of Code section 956
if the payable is satisfied within 90 days of the close of the APA Tax Year with respect to which it is established.
ii. [] The intercompany payable will bear interest at an arm’s length rate.
[] Such arm’s length rate is not specified in this APA and will be determined under applicable legal principles.
[] Such arm’s length rate is determined as follows. #DESCRIPTION OF ARM’S LENGTH RATE (FOR EXAMPLE,
FOR A U.S. DOLLAR PAYABLE, A CERTAIN APPLICABLE FEDERAL RATE UNDER U.S. TREASURY REGU-
LATIONS SECTION 1.482-2(a)(2)(iii)(C)).
[] This APA is bilateral or multilateral. As agreed between the United States and #COUNTRY(IES), the intercompany payable
will not bear interest.
iii. The intercompany payable must be satisfied, in a manner permitted under Rev. Proc. 99-32 or any successor revenue proce-
dure, within 90 days of the later of (1) the date for timely filing (with extensions) of the U.S. return for such APA Tax Year,
and (2) the APA’s U.S. Effective Date. If any amount of the intercompany payable is not otherwise so satisfied within that
90-day period, such amount, on the last day of such period, will be deemed (1) to be paid between U.S. Entity and Non-U.S.
Entity in satisfaction of the payable, and (2) to be paid (directly or indirectly, as specified below) between U.S. Entity and
Non-U.S. Entity in the opposite direction (that is, from the deemed recipient of the intercompany payable to the deemed
payor of the intercompany payable). These two deemed payments on the same day will cancel and thus yield no net cash
flow between these two entities. The second of these deemed payments will be referred to as the “reverse payment.” The
reverse payment will be deemed to be as follows:
A. If the net APA Primary Adjustment increases U.S. income:
[] The reverse payment will be deemed to be a contribution to capital from U.S. Entity to Non-U.S. Entity, either directly, or
indirectly through the corporate chain, as the case may be.
[] The reverse payment will be deemed to be a distribution from U.S. Entity to Non-U.S. Entity, either directly, or indirectly
through the corporate chain, as the case may be.
[] The reverse payment will be deemed to be a distribution from U.S. Entity to #COMMON PARENT, either directly, or in-
directly through the corporate chain, as the case may be, followed by a contribution by #COMMON PARENT to non-U.S.
Entity, either directly or indirectly through the corporate chain, as the case may be.
B. If the net APA Primary Adjustment decreases U.S. income:
[] The reverse payment will be deemed to be a contribution to capital from non-U.S. Entity to U.S. Entity, either directly, or
indirectly through the corporate chain, as the case may be.
[] The reverse payment will be deemed to be a distribution from non-U.S. Entity to U.S. Entity, either directly, or indirectly
through the corporate chain, as the case may be.
[] The reverse payment will be deemed to be a distribution from non-U.S. Entity to #COMMON PARENT, either directly,
or indirectly through the corporate chain, as the case may be, followed by a contribution by #COMMON PARENT to U.S.
Entity, either directly, or indirectly through the corporate chain, as the case may be.
This situation is generally described in paragraph 4.66 of the OECD Guidelines, and in U.S. Treasury Regulations section 1.482-
1(g) and Rev. Proc. 99-32.
In this APA, if applicable:
[]* For the APA Tax Year(s) ending on or before #DATE, it is agreed that the net APA Primary Adjustment(s), if any, from the
application of the Covered Methods are as follows: #FOR EACH SUCH APA TAX YEAR, DESCRIPTION OF WHETH-
ER THERE IS A NET APA PRIMARY ADJUSTMENT, AND IF SO THE AMOUNT AND DIRECTION. IF THERE IS
MORE THAN ONE COVERED METHOD FOR A REPATRIABLE ISSUE, ALSO PROVIDE A TABLE SHOWING THE
DERIVATION, FOR EACH SUCH APA TAX YEAR, OF THE NET APA PRIMARY ADJUSTMENT FROM THE APA
PRIMARY ADJUSTMENT (OR LACK OF ONE) FOR EACH SUCH COVERED METHOD. #FOR ANY SUCH NET
APA PRIMARY ADJUSTMENTS, DESCRIPTION OF THE MEANS BY WHICH THE CONFORMING ADJUSTMENT
HAS BEEN OR WILL BE SATISFIED, WITH APPLICABLE DATES.

April 6, 2020 648 Bulletin No. 2020–15
7. Definitions
The definitions in the table below apply to this APA.
The defined terms in this table include certain measures of profitability (e.g., operating profit, operating margin). Most of these
measures are ultimately defined in terms of sales revenue, operating expenses, and operating assets (defined terms), and cogs and
non-interest-bearing liabilities (undefined terms). The definitions of sales revenue, operating expenses, and operating assets contain a
limitation to the relevant business activity. Similarly, each use of the terms “cogs” and “non-interest-bearing liabilities” is accompa-
nied by a limitation to the relevant business activity. Therefore, the measures of profitability based on these five terms all are defined
with a limitation to the relevant business activity. (Certain other measures of profitability in this table relate to the provision of ser-
vices and are defined with reference to those services. Therefore, those measures as well contain a limitation to the relevant business
activity.)
TermDefinition
Arm’s Length RangeWith respect to a particular Covered Method, a numerical range that defines the values for which
certain financial results of the Tested Party are considered to satisfy the arm’s length standard.
(This term may be referenced in section 4 of this Appendix A.)
APA Primary Adjustment(Defined in section 5 of this Appendix A.)
APA Covered Year(Defined in section 2 of this Appendix A.)
APA Term(Defined in section 2 of this Appendix A.)
APA Tax Year(Defined in section 2 of this Appendix A.)
Applicable Accounting Stan-
dard
The Applicable Accounting Standard is #CHOOSE FROM U.S. GAAP, IFRS, ETC. for U.S.
Taxpayer and #CHOOSE FROM U.S. GAAP, IFRS, ETC. for Non-U.S. Taxpayer.
Berry ratioThe ratio of gross profit to operating expenses.
CodeThe U.S. Internal Revenue Code of 1986, title 26 of the United States Code, as amended.
correspond, corresponding(With regard to APA Covered Years and APA Tax Years, defined in section 2 of this Appendix A;
with regard to Covered Issues and Covered Methods, defined in section 4 of this Appendix
A.)
Covered Entity(ies)(Defined in section 1 of this Appendix
A.)
Covered Issue(s)(Defined in section 3 of this Appendix A.)
Covered MethodA method used to resolve one or more Covered Issues, as described in section 4 of this Appendix
A. (In some cases, this method may be a “transfer pricing method” within the meaning of chapter
II of the OECD Guidelines and U.S. Treasury Regulations section 1.482-1(b).)
Critical Assumption fails,
failure of a Critical Assump-
tion
A Critical assumption “fails” when the Critical Assumption has not been met. This situation is
referred to as the “failure” of the Critical Assumption.
Early TerminationA termination of this APA’s effectiveness, either in its entirely or only as applied to certain Cov-
ered Issues, before the end of the APA Term. Such a termination could result from one or more
of the following circumstances: (i) a Critical Assumption failure, (ii) a violation of the terms
and conditions of this APA, (iii) a cancellation of the APA under Rev. Proc. 2015-41, and (iv) an
amendment of the APA. If an Early Termination so terminates this APA’s effectiveness as applied
to a particular Covered Issue, the Early Termination is said to “apply” to or for that Covered
Issue.
Any such termination of effectiveness would occur as of the end of an APA Tax Year (see Rev.
Proc. 2015-41, section 7.06). Because such end of an APA Tax Year is before the end of the APA
Term, such end of an APA Tax Year is also the end of the corresponding APA Covered Year (see
the definitions of APA Tax Year and APA Covered Year in section 2 of this Appendix A). Thus,
an Early Termination always would occur as of the end of an APA Covered Year. That fact is as-
sumed in the definitions in this table of Last Effective APA Covered Year and Last Effective APA
Subterm Covered Year.
Gross profitSales revenue, less cost of goods sold for the relevant business activity.
Gross profit margingross profit, divided by sales revenue
Gross profit markupgross profit, divided by cost of goods sold for the relevant business activity

Bulletin No. 2020–15 649 April 6, 2020
TermDefinition
Gross services marginIn connection with a provision of services, the ratio of gross services profit to the price paid for
the services in an uncontrolled transaction. For this purpose, gross services profit equals the
amount of such price that is retained by the Tested Party.
Gross services profit markupIn connection with a provision of services, gross services profit, divided by transactional costs.
For this purpose, gross services profit equals sales revenue less transactional costs. Also, for this
purpose, transactional costs equal costs directly attributable to providing the services. Such costs
would include, for example, all compensation attributable to employees directly involved in the
performance of such services, and costs of materials and supplies consumed or made available in
rendering the services.
IFRSInternational Financial Reporting Standards.
Invested capitalOperating assets, less non-interest-bearing liabilities used in the relevant business activity.
IRSThe Internal Revenue Service, an agency of the U.S. government.
IFRSInternational Financial Reporting Standards.
Last Effective APA Covered
Year
For a particular Covered Method, the last APA Covered Year for which this APA remains effec-
tive as to the Covered Issue(s) corresponding to that Covered Method. The Last Effective APA
Covered Year will be the last APA Covered Year unless an Early Termination applies to such
Covered Issue(s). See also the definition in this table of Early Termination.
Last Effective APA Subterm
Covered Year
For a particular Covered Method, and with reference to a particular set of APA Covered Years
that is defined as a subterm, the last APA Covered Year in the subterm for which this APA
remains effective as to the Covered Issue(s) corresponding to that Covered Method. The Last
Effective APA Subterm Covered Year will be the last APA Covered Year in the subterm unless
an Early Termination applies to such Covered Issue(s) and renders the APA ineffective as to
such Covered Issue(s) before the end of the subterm. See also the definition in this table of Early
Termination.
Markup on total costsThe ratio of operating profit to total costs.
MedianWith respect to a particular Arm’s Length Range, the median of a set of observations of market
data from which that Arm’s Length Range was determined.
Non-U.S. Taxpayer(Defined in section 1 of this Appendix A.)
Non-U.S. Covered Entity(ies)(Defined in section 1 of this Appendix A.)
OECD Guidelines
Organisation for Economic Co-operation and Development, OECD Transfer Pricing Guidelines
for Multinational Enterprises and Tax Administrations (July 2017).
OECD PE Report
Organisation for Economic Co-operation and Development, 2010 Report on Attribution of Profit
to Permanent Establishments (July 22, 2010).
Operating assetsThe value of all assets used in the relevant business activity, including fixed assets and current
assets (such as accounts receivable and inventories). The following items are excluded from
operating assets: cash, cash equivalents, short-term investments, deferred tax assets, tax refunds,
intangibles, investments in subsidiaries, portfolio investments.
Operating expensesAll expenses (including depreciation) not included in cost of goods sold except for interest
expense, domestic and foreign income taxes, amortization of intangibles, and any other expens-
es not related to the operation of the relevant business activity. Operating expenses normally
include, for example, expenses associated with advertising, promotion, sales, marketing, ware-
housing and distribution, administration, and a reasonable allowance for depreciation. For U.S.
Taxpayer, foreign income taxes are defined in U.S. Treasury Regulations section 1.902-1(a)(7).
Operating marginThe ratio of operating profit to sales revenue.
Operating profitSales revenue, less cost of goods sold for the relevant business activity, less operating expenses.
Rev. Proc. 99-32A revenue procedure issued by the IRS that is cited as Rev. Proc. 99-32, 1999-2 C.B. 296.
Rev. Proc. 2015-41A revenue procedure issued by the IRS that is cited as Rev. Proc. 2015-41, 2015-35 I.R.B 263.
Repatriable Issue(Defined in section 6 of this Appendix A.)

April 6, 2020 650 Bulletin No. 2020–15
TermDefinition
Relevant Financial DataWith respect to a particular Covered Method, the financial results of the Tested Party that are
tested, together with any other financial data (of the Tested Party or any other party) that are
considered in determining compliance with the Covered Method.
Return on invested capital(Defined in the same way as “return on operating assets,” but with “operating assets” replaced by
“invested capital” wherever it occurs in the definition.)
Return on operating assetsWith respect to a particular Covered Method, the Tested Party for that Covered Method, and a
testing period used in that Covered Method, the operating profit over the testing period divided
by the time-weighted average operating assets over the testing period.
For this purpose, the time-weighted average operating assets over the testing period is the sum,
over all APA Covered Years in the testing period, of the following product: (i) the simple average
of the operating asset levels at the start and end of the APA Tax Year corresponding to such APA
Covered Year, multiplied by (ii) the ratio of the number of calendar days in the APA Covered
Year, to 365.
For example, suppose that (i) the testing period consists of two consecutive APA Covered Years,
the first with 183 calendar days and the second with 366 calendar days, (ii) the total operating
profit over those two years is exactly 3.4, and (iii) the operating assets levels are exactly 10 at
the start of the APA tax year corresponding to the first APA Covered Year, 16 at the end of the
APA Tax Year corresponding to the first APA Covered Year (which is also the start of the APA
Tax Year corresponding to the second APA Covered Year), and 22 at the end of the APA Tax Year
corresponding to the second APA Covered Year. Then the time-weighted average operating assets
over the testing period is [(10+16)/2]*(183/365) + [(16+22)/2]*(366/365) = 25.5699. The return
on operating assets is then 3.4/25.5699 = 13.30%.
Rollback Period(This term, if applicable, is defined in section 2 of this Appendix A.)
Sales revenueTotal receipts from sale of goods and provision of services, less returns and allowances, for the
relevant business activity.
Tax yearA standard or irregular year that is used for tax reporting purposes. For U.S. Taxpayer, a tax year
is a “taxable year,” as defined in Code section 441.
Tested Party(Defined in section 4 of this Appendix A with regard to a particular Covered Method.)
Testing periodThe time period over which financial results are tested (see section 4 of Appendix
A to this
APA).
Total costsCost of goods sold for the relevant business activity, plus operating expenses.
U.S. Treasury RegulationsTax regulations issued by the U.S. Treasury Department, found at title 26 of the Code of Federal
Regulations.
U.S. Covered Entity(ies)(Defined in section 1 of this Appendix A.)
U.S. Effective DateThe date, or later date of the dates, upon which the APA is executed by the IRS and by or on
behalf of each U.S. Covered Entity.
U.S. GAAPU.S. generally accepted accounting principles.
U.S. returnAny of the “Returns with respect to income taxes under subtitle A” required by Code section
6012, and any “return” for a partnership required by Code section 6031.
U.S. Taxpayer(Defined in section 1 of this Appendix A.)

Bulletin No. 2020–15 651 April 6, 2020
APPENDIX B
CRITICAL ASSUMPTIONS
The Critical Assumptions are:
1. The Covered Entities’ business activities, functions performed, risks assumed, assets employed, contractual terms, markets,
and economic conditions faced in relation to the Covered Issue(s) will remain materially the same as described in the APA
Request. For this purpose, a mere change in business results will not be a material change.
2. The Covered Entities’ financial accounting methods and classifications and methods of estimation in relation to the Covered
Issue(s) and Covered Method(s) will remain materially the same as described or used in the APA Request.
If indicated, the effect of a critical assumption failure may be limited as follows:
[] The failure of Critical Assumptions #XXX listed above will affect the effectiveness of this APA only as to Covered Issues
#YYY listed in Appendix A. Thus, as to the other Covered Issues, the APA will remain in force (except to the extent some
other condition affects the APA’s effectiveness as to those Covered Issues).
The Covered Entities will not cause a critical assumption to fail for the purpose of rendering the APA ineffective, unless they have
an independent business justification (unrelated to rendering the APA ineffective) for the action that causes the critical assumption
to fail. If one or more Covered Entities do cause a critical assumption to fail for the purpose of rendering the APA ineffective, and
without such independent business justification, then the Covered Entities will not withhold consent to an amendment to this APA
to the effect that this APA will continue in force without regard to such failure. In this case, if a Covered Entity refuses to sign such
an amendment, such an amendment may be executed without such signature and will then have the same force and effect as if the
amendment had such signature.

April 6, 2020 652 Bulletin No. 2020–15
APPENDIX C
APA RECORDS AND ANNUAL REPORT
APA RECORDS
The APA Records will consist of all documents listed below for inclusion in the Annual Report, as well as all documents, notes,
work papers, records, or other writings that support the information provided in such documents.
ANNUAL REPORT
An Annual Report must be submitted for each APA Tax Year in accordance with paragraph 6(e) of the APA and section 7.02 of
Rev. Proc. 2015-41.
For each APA Tax Year, the Annual Report (and each copy or version as required by paragraph 6(e) of the APA) will include:
1. Two copies of a properly completed APA Annual Report Summary in the form of Appendix D to this APA, one copy of
the form bound with, and one copy provided separately from, the rest of the Annual Report. (The electronic version of the
Annual Report need have only one copy of this item.)
2. A table of contents, organized according to the additional required items listed below.
3. For such APA Tax Year and the corresponding APA Covered Year, statements that fully identify, describe, analyze, and ex-
plain:
a. All material differences between the Covered Entities’ business activities, functions performed, risks assumed, assets
employed, contractual terms, markets, and economic conditions faced in relation to the Covered Issues during such APA
Covered Year from those same items described in the APA Request. If there have been no such material differences, the
Annual Report will include a statement to that effect.
b. All material differences between Covered Entities’ financial accounting methods and classifications and methods of
estimation in relation to the Covered Issues and Covered Methods used during such APA Covered Year, from those
described or used in the APA Request. If any change was made to conform to changes in the Applicable Accounting
Standard, U.S. Taxpayer will specifically identify the change. If there have been no such material differences, the An-
nual Report will include a statement to that effect.
c. Regarding notices under paragraph 16 of the APA:
i. A current statement of how the IRS should provide such notices to U.S. Taxpayer (and, if applicable, to U.S. Tax-
payer’s representative).
ii. A copy of any such notices that were submitted by U.S. Taxpayer to the IRS after the last Annual Report was
submitted (or, if there was no prior Annual Report, after the APA was executed). If there were no such notices, the
Annual Report will include a statement to that effect.
d. Any failure of any Critical Assumption. If there has been no such failure, the Annual Report will include a statement to
that effect.
e. Whether or not material information submitted while the APA Request was pending is discovered to be false, incorrect,
or incomplete, and if so a correction or completion of that information, as applicable.
f. Any change to any entity classification for federal income tax purposes (including any change that causes an entity to be
disregarded for federal income tax purposes) of any Worldwide Group member that is a Covered Entity or is otherwise
relevant to the Covered Issue(s) or Covered Method(s).
g. The following regarding any APA Primary Adjustments made for such APA Tax Year under Appendix A to this APA:
i. The amounts of any APA Primary Adjustments;
ii. The circumstances that led to such APA Primary Adjustments being necessary;
iii. A calculation of the net APA Primary Adjustment as defined in Appendix A to this APA; and
iv. A complete description of the means by which the conforming adjustment (see section 6 of Appendix A to this
APA) is accomplished, including:

Bulletin No. 2020–15 653 April 6, 2020
A. a description of any accounts payable established, including the entities involved and when the payables are
established;
B. a description of any amounts paid or deemed paid (including amounts paid or deemed paid in satisfaction of
an intercompany payable established as described in section 6 of Appendix A to this APA, and including any
deemed reverse payments as described in section 6 of Appendix A to this APA), that specifies the entities in-
volved, when the amounts are paid or deemed paid, and by what means any amounts are actually paid; and
C. the character (such as capital, ordinary, income, expense, dividend, contribution to capital) and country source
of any payments and deemed payments, and the specific affected line item(s) of any affected U.S. return;
h. A detailed numerical explanation of how the result of the application of the Covered Methods is reflected on the U.S.
return, with reference to particular line items on the U.S. return. This explanation shall include the amounts, description,
reason for, and financial analysis of any book-tax differences, as reflected on Schedule M-1 or Schedule M-3 of the U.S.
return for such APA Tax Year, that (i) are relevant to an APA Primary Adjustment, (ii) otherwise are relevant to the book
and tax treatment of any income or expense item that is part of the Relevant Financial Data for, or is determined by, any
Covered Method for such APA Tax Year, or (iii) otherwise are relevant to the APA. U.S. Taxpayer shall not simply attach
a copy of the pertinent schedule. Rather, U.S. Taxpayer shall specifically identify the relevant items from that schedule
and shall describe in appropriate detail the nature of those items, how they arose, and how they are accounted for.
i. Whether or not U.S. Taxpayer contemplates requesting, or has requested, to renew, modify, or cancel the APA.
4. The Financial Statements and additional statements required under paragraph 6(f) of the APA, for such APA Tax Year and
for any other tax year whose financial data are relevant to compliance with the APA for such APA Tax Year;
5. A financial analysis that includes U.S. Taxpayer’s calculations to apply the Covered Method(s) to the Covered Issue(s) for
such APA Covered Year and supports those calculations with additional material that ties those calculations to the Financial
Statements. The intent of this requirement is that the analysis submitted should provide a clear, complete, detailed, and
self-contained means by which the IRS can verify compliance with the Covered Method(s). This requirement is further
explained as follows:
a. The additional material must support every numerical input to U.S. Taxpayer’s calculations.
b. The additional material could include, for example, consolidating financial statements, segmented financial data, and
records from the general ledger.
c. Where segmented data are used, U.S. Taxpayer must specify in detail how it accomplished the segmentation, including
how it made allocations and apportionments, including (i) the definition and calculation of any apportionment keys
used, and (ii) the calculations applying such keys. The inputs used for those various calculations must be tied to the
Financial Statements.
d. The additional material must be annotated sufficiently to let the IRS easily trace U.S. Taxpayer’s entire calculations to
objective, verifiable sources of data.
e. Where needed for clarity, terms must be defined.
6. The financial results pertinent to the Covered Method(s), for such APA Covered Year and all prior years, entered along with
data concerning the Covered Method(s) in an electronic results template available by contacting APMA.
7. [] An organizational chart for Worldwide Group, revised annually to reflect all ownership or structural changes of the
Covered Entities and any other entities that are relevant to the Covered Issue(s) or are otherwise relevant to the Covered
Method(s).
[]* An organizational chart for a part of Worldwide Group that includes all Covered Entities and includes any other entities
relevant to the Covered Issue(s) or Covered Method(s), revised annually to reflect all ownership or structural chang-
es of entities that are involved in the Covered Issue(s) or are otherwise relevant to the Covered Issue(s) or Covered
Method(s).
8. A valid IRS Form 2848 “Power of Attorney and Declaration of Representative” for any representative to receive notices
under paragraph 16 of this APA.
9. A copy of the APA and any amendment.
10. A penalty of perjury statement, executed in accordance with Rev. Proc. 2015-41, sections 7.02(8) and (9).

April 6, 2020 654 Bulletin No. 2020–15
APPENDIX D
APA ANNUAL REPORT SUMMARY FORM
The APA Annual Report Summary on the next page is a required APA Record. APMA supplies some of the information requested on
the form. U.S. Taxpayer is to supply the remaining information requested by the form and submit the form as part of its Annual Report.
Internal Revenue ServiceAPMA Case No.
Large Business and International DivisionReviewer
Treaty & Transfer Pricing OperationsTeam Leader
Advance Pricing Mutual Agreement ProgramEconomist
Other APA Team Members
APA Information
U.S. Taxpayer’s Name
U.S. Taxpayer’s EIN
U.S. Taxpayer’s NAICS
Unilateral/Bilateral/Multilateral
Original or Renewal
APA Common Name, if any
APA Request Filing Date
Date APA Executed
APA Term (date-to-date, inclusive)
Foreign Countr(y)ies Involved
Annual Report Due Dates for years ending on or before [date]:
Annual Report Due Dates for other years: [last month of tax year] 15 following close of year
Covered Methods Summary Description
(e.g., CPM, operating margin 2%-5%)
Taxpayer’s Principal Representative
APA Annual Report Information:
Year(s) covered by this Annual Report
Issues for APMA’s special attention (or “None”)
Taxpayer Notice PersonName
Title
If necessary, include aAddress
current Form 2848 for theCity/State/Zip
Notice PersonPhone/Fax
Email
Current Representative, if anyName
Title
Include a current Form 2848Address
for the representativeCity/State/Zip
Phone/Fax
Email
Date Annual Report Filed (to be filled in by APMA):

Bulletin No. 2020–15 655 April 6, 2020
Announcement of
Disciplinary Sanctions
From the Office of
Professional Responsibility
Announcement 2020-3
The Office of Professional Respon-
sibility (OPR) announces recent disci-
plinary sanctions involving attorneys, cer-
tified public accountants, enrolled agents,
enrolled actuaries, enrolled retirement
plan agents, appraisers, and unenrolled/
unlicensed return preparers (individuals
who are not enrolled to practice and are
not licensed as attorneys or certified pub-
lic accountants). Licensed or enrolled
practitioners are subject to the regulations
governing practice before the Internal
Revenue Service (IRS), which are set out
in Title 31, Code of Federal Regulations,
Subtitle A, Part 10, and which are released
as Treasury Department Circular No.
230. The regulations prescribe the duties
and restrictions relating to such practice
and prescribe the disciplinary sanctions
for violating the regulations. Unenrolled/
unlicensed return preparers are subject to
Revenue Procedure 81-38 and supersed-
ing guidance in Revenue Procedure 2014-
42, which govern a preparer’s eligibility
to represent taxpayers before the IRS in
examinations of tax returns the preparer
both prepared for the taxpayer and signed
as the preparer. Additionally, unenrolled/
unlicensed return preparers who volun-
tarily participate in the Annual Filing Sea-
son Program under Revenue Procedure
2014-42 agree to be subject to the duties
and restrictions in Circular 230, including
the restrictions on incompetent or disrep-
utable conduct.
The disciplinary sanctions to be im-
posed for violation of the applicable stan-
dards are:
Disbarred from practice before the
IRS—An individual who is disbarred
is not eligible to practice before the IRS
as defined at 31 C.F.R. § 10.2(a)(4) for a
minimum period of five (5) years.
Suspended from practice before the
IRS—An individual who is suspended is
not eligible to practice before the IRS as
defined at 31 C.F.R. § 10.2(a)(4) during
the term of the suspension.
Censured in practice before the
IRS—Censure is a public reprimand. Un-
like disbarment or suspension, censure
does not affect an individual’s eligibility
to practice before the IRS, but OPR may
subject the individual’s future practice
rights to conditions designed to promote
high standards of conduct.
Monetary penalty—A monetary pen-
alty may be imposed on an individual who
engages in conduct subject to sanction,
or on an employer, firm, or entity if the
individual was acting on its behalf and it
knew, or reasonably should have known,
of the individual’s conduct.
Disqualification of appraiser—An
appraiser who is disqualified is barred
from presenting evidence or testimony in
any administrative proceeding before the
Department of the Treasury or the IRS.
Ineligible for limited practice—An
unenrolled/unlicensed return preparer
who fails to comply with the requirements
in Revenue Procedure 81-38 or to comply
with Circular 230 as required by Revenue
Procedure 2014-42 may be determined in-
eligible to engage in limited practice as a
representative of any taxpayer.
Under the regulations, individuals sub-
ject to Circular 230 may not assist, or ac-
cept assistance from, individuals who are
suspended or disbarred with respect to
matters constituting practice (i.e., repre-
sentation) before the IRS, and they may
not aid or abet suspended or disbarred in-
dividuals to practice before the IRS.
Disciplinary sanctions are described in
these terms:
Disbarred by decision, Suspended by
decision, Censured by decision, Mone-
tary penalty imposed by decision, and
Disqualified after hearing—An adminis-
trative law judge (ALJ) issued a decision
imposing one of these sanctions after the
ALJ either (1) granted the government’s
summary judgment motion or (2) con-
ducted an evidentiary hearing upon OPR’s
complaint alleging violation of the regu-
lations. After 30 days from the issuance
of the decision, in the absence of an ap-
peal, the ALJ’s decision becomes the final
agency decision.
Disbarred by default decision, Sus-
pended by default decision, Censured
by default decision, Monetary penalty
imposed by default decision, and Dis-
qualified by default decision—An ALJ,
after finding that no answer to OPR’s
complaint was filed, granted OPR’s mo-
tion for a default judgment and issued a
decision imposing one of these sanctions.
Disbarment by decision on appeal,
Suspended by decision on appeal, Cen-
sured by decision on appeal, Monetary
penalty imposed by decision on appeal,
and Disqualified by decision on ap-
peal—The decision of the ALJ was ap-
pealed to the agency appeal authority, act-
ing as the delegate of the Secretary of the
Treasury, and the appeal authority issued a
decision imposing one of these sanctions.
Disbarred by consent, Suspended by
consent, Censured by consent, Mone-
tary penalty imposed by consent, and
Disqualified by consent—In lieu of a
disciplinary proceeding being instituted or
continued, an individual offered a consent
to one of these sanctions and OPR accept-
ed the offer. Typically, an offer of consent
will provide for: suspension for an indef-
inite term; conditions that the individual
must observe during the suspension; and
the individual’s opportunity, after a stat-
ed number of months, to file with OPR a
petition for reinstatement affirming com-
pliance with the terms of the consent and
affirming current fitness and eligibility
to practice (i.e., an active professional li-
cense or active enrollment status, with no
intervening violations of the regulations).
Suspended indefinitely by decision in
expedited proceeding, Suspended indef-
initely by default decision in expedited
proceeding, Suspended by consent in
expedited proceeding—OPR instituted
an expedited proceeding for suspension
(based on certain limited grounds, in-
cluding loss of a professional license for
cause, and criminal convictions).
Determined ineligible for limited
practice—There has been a final deter-
mination that an unenrolled/unlicensed
return preparer is not eligible for limited
representation of any taxpayer because the
preparer violated standards of conduct or
failed to comply with any of the require-
ments to act as a representative.
A practitioner who has been disbarred
or suspended under 31 C.F.R. § 10.60, or
suspended under § 10.82, or a disqualified
appraiser may petition for reinstatement
before the IRS after the expiration of 5
years following such disbarment, suspen-
sion, or disqualification (or immediately

April 6, 2020 656 Bulletin No. 2020–15
following the expiration of the suspension
or disqualification period if shorter than 5
years). Reinstatement will not be granted
unless the IRS is satisfied that the peti-
tioner is not likely to engage thereafter in
conduct contrary to Circular 230, and that
granting such reinstatement would not be
contrary to the public interest.
Reinstatement decisions are published
at the individual’s request, and described
in these terms:
Reinstated to practice before the
IRS—The individual’s petition for re-
instatement has been granted. The
agent, and eligible to practice before the
IRS, or in the case of an appraiser, the in-
dividual is no longer disqualified.

Reinstated to engage in limited
practice before the IRS—The individ-
ual’s petition for reinstatement has been
granted. The individual is an unenrolled/
unlicensed return preparer and eligible to
engage in limited practice before the IRS,
subject to requirements the IRS has pre-
scribed for limited practice by tax return
preparers.
OPR has authority to disclose the
grounds for disciplinary sanctions in these
situations: (1) an ALJ or the Secretary’s
delegate on appeal has issued a final de-
cision; (2) the individual has settled a dis-
ciplinary case by signing OPR’s “consent
to sanction” agreement admitting to one
or more violations of the regulations and

consenting to the disclosure of the admit-
ted violations (for example, failure to file
Federal income tax returns, lack of due
diligence, conflict of interest, etc.); (3)
OPR has issued a decision in an expedited
proceeding for indefinite suspension; or
(4) OPR has made a final determination
(including any decision on appeal) that an
unenrolled/unlicensed return preparer is
ineligible to represent any taxpayer before
the IRS.
Announcements of disciplinary sanc-
tions appear in the Internal Revenue Bul-
letin at the earliest practicable date. The
sanctions announced below are alphabet-
ized first by state and second by the last
names of the sanctioned individuals.
City & State Name
Professional Designation
Disciplinary Sanction Effective Date(s)
California
PasadenaCampbell, MarshallCPA/
Enrolled Agent
Disbarred by Decision on
Appeal
Indefinite from
July 16, 2018
Porter RanchChotani,
Masood A.
C PAReinstated to
practice before the
IRS, effective
November 05, 2019
Fair OaksKauffman,
Darryl Lynn
C PASuspended by default decision
in expedited proceeding under
31 C.F.R. § 10.82(b)
Indefinite from
October 30, 2019
Rolling Hills
Estate
Keyser, Joel D.C PASuspended by default decision
in expedited proceeding under
31 C.F.R. § 10.82(b)
Indefinite from
December 13, 2019
District of
Columbia (DC)
Anthony, Jr., Warner
H., see North
Carolina

Bulletin No. 2020–15 657 April 6, 2020
City & StateNameProfessional DesignationDisciplinary SanctionEffective Date(s)
Florida
BradentonAvalle, Dawn M.Enrolled AgentSuspended by default decision
in expedited proceeding under
31 C.F.R. § 10.82(b)
Indefinite from
November 26, 2019
Holmes BeachMorse, Daniel W.AttorneySuspended by default decision
in expedited proceeding under
31 C.F.R. § 10.82(b)
Indefinite from
October 09, 2019
MiamiSierra, JimmyEnrolled AgentSuspended by default decision
in expedited proceeding under
31 C.F.R. § 10.82(b)
Indefinite from
November 20, 2019
DoverSmith, John M.C PASuspended by default decision
in expedited proceeding under
31 C.F.R. § 10.82(b)
Indefinite from
September 09, 2019
Louisiana
Anthony, Jr.,
Warner H.
See North Carolina
Maine
South ParisWhite, Jeffrey P.AttorneySuspended by default decision
in expedited proceeding under
31 C.F.R. § 10.82(b)
Indefinite from
September 18, 2019
Massachusetts
GloucesterFraser, Karen J.C PASuspended by default decision
in expedited proceeding under
31 C.F.R. § 10.82(b)
Indefinite from
December 13, 2019
IpswichMauser,
Timothy M.
AttorneySuspended by default decision
in expedited proceeding under
31 C.F.R. § 10.82(b)
Indefinite from
December 13, 2019

April 6, 2020 658 Bulletin No. 2020–15
City & StateNameProfessional DesignationDisciplinary SanctionEffective Date(s)
Michigan
HollandPalmer, Jeffrey J.AttorneySuspended by decision in
expedited proceeding under
31 C.F.R. § 10.82(b)
Indefinite from
November 22, 2019
Minnesota
MinneapolisNora, Wendy A.AttorneySuspended by decision in
expedited proceeding under
31 C.F.R. § 10.82(b)
Indefinite from
November 19, 2019
Mississippi
HattiesburgNicholson, Jr.,
Carl L.
C PASuspended by default decision
in expedited proceeding under
31 C.F.R. § 10.82(b)
Indefinite from
November 26, 2019
New Jersey
Egg Harbor
Township
Foust, Chris A.C PASuspended by default decision
in expedited proceeding under
31 C.F.R. § 10.82(b)
Indefinite from
November 26, 2019
New York
Staten IslandShin, Tom H.C PASuspended by decision in
expedited proceeding under
31 C.F.R. § 10.82(b)
Indefinite from
September 09, 2019
Rockville
Center
Bronner, Ira H.Enrolled AgentSuspended by consent under
31 C.F.R. §§ 10.51(a)(1-3)
Indefinite from
October 30, 2019
Great NeckMcCoy, William L.Enrolled AgentDisbarred by Decision on
Appeal by Appellate Authority
31 C.F.R §10.51(a); and a
$10,000 monetary penalty
September 7, 2017

Bulletin No. 2020–15 659 April 6, 2020
City & StateNameProfessional DesignationDisciplinary SanctionEffective Date(s)
North Carolina
GreensboroAnthony, Jr.,
Warner H.
AttorneySuspended by default decision
in expedited proceeding under
31 C.F.R. § 10.82(b)
Indefinite from
October 16, 2019
FairviewJames, Perry A.C PASuspended by default decision
in expedited proceeding under
31 C.F.R. § 10.82(b)
Indefinite from
September 24, 2019
Oklahoma
Oklahoma CitySanger, Brett D.AttorneyReinstated to prac-
tice before the IRS,
effective
May 16, 2019
Pennsylvania
Morse, Daniel W.,
see Florida
Wisconsin
Nora, Wendy A., see
Minnesota
Morse, Daniel W.,
see Florida

Bulletin No. 2020–15 i April 6, 2020
Definition of Terms
Revenue rulings and revenue procedures
(hereinafter referred to as “rulings”) that
have an effect on previous rulings use the
following defined terms to describe the
effect:
Amplified describes a situation where
no change is being made in a prior pub-
lished position, but the prior position is
being extended to apply to a variation of
the fact situation set forth therein. Thus, if
an earlier ruling held that a principle ap-
plied to A, and the new ruling holds that
the same principle also applies to B, the
earlier ruling is amplified. (Compare with
modified, below).
Clarified is used in those instances
where the language in a prior ruling is be-
ing made clear because the language has
caused, or may cause, some confusion. It
is not used where a position in a prior rul-
ing is being changed.
Distinguished describes a situation
where a ruling mentions a previously pub-
lished ruling and points out an essential
difference between them.
Modified is used where the substance
of a previously published position is being
changed. Thus, if a prior ruling held that a
principle applied to A but not to B, and the
new ruling holds that it applies to both A
and B, the prior ruling is modified because
it corrects a published position. (Compare
with amplified and clarified, above).
Obsoleted describes a previously pub-
lished ruling that is not considered deter-
minative with respect to future transactions.
This term is most commonly used in a ruling
that lists previously published rulings that
are obsoleted because of changes in laws or
regulations. A ruling may also be obsoleted
because the substance has been included in
regulations subsequently adopted.
Revoked describes situations where the
position in the previously published ruling
is not correct and the correct position is
being stated in a new ruling.
Superseded describes a situation where
the new ruling does nothing more than
restate the substance and situation of a
previously published ruling (or rulings).
Thus, the term is used to republish under
the 1986 Code and regulations the same
position published under the 1939 Code
and regulations. The term is also used
when it is desired to republish in a single
ruling a series of situations, names, etc.,
that were previously published over a
period of time in separate rulings. If the
new ruling does more than restate the sub-
stance of a prior ruling, a combination of
terms is used. For example, modified and
superseded describes a situation where the
substance of a previously published ruling
is being changed in part and is continued
without change in part and it is desired to
restate the valid portion of the previous-
ly published ruling in a new ruling that is
self contained. In this case, the previously
published ruling is first modified and then,
as modified, is superseded.
Supplemented is used in situations in
which a list, such as a list of the names of
countries, is published in a ruling and that
list is expanded by adding further names
in subsequent rulings. After the original
ruling has been supplemented several
times, a new ruling may be published that
includes the list in the original ruling and
the additions, and supersedes all prior rul-
ings in the series.
Suspended is used in rare situations to
show that the previous published rulings
will not be applied pending some future
action such as the issuance of new or
amended regulations, the outcome of cas-
es in litigation, or the outcome of a Ser-
vice study.
Abbreviations
The following abbreviations in current use
and formerly used will appear in material
published in the Bulletin.
A—Individual.
Acq.—Acquiescence.
B—Individual.
BE—Beneficiary.
BK—Bank.
B.T.A.—Board of Tax Appeals.
C—Individual.
C.B.—Cumulative Bulletin.
CFR—Code of Federal Regulations.
CI
—City.
COOP—Cooperative.
Ct.D.—Court Decision.
CY—County.
D—Decedent.
DC—Dummy Corporation.
DE—Donee.
Del. Order—Delegation Order.
DISC—Domestic International Sales Corporation.
DR—Donor.
E—Estate.
EE—Employee.
E.O.—Executive Order.
ER—Employer.
ERISA—Employee Retirement Income Security Act.
EX—Executor.
F—Fiduciary.
FC—Foreign Country.
FICA—Federal Insurance Contributions Act.
FISC—Foreign International Sales Company.
FPH—Foreign Personal Holding Company.
F.R.—Federal Register.
FUTA—Federal Unemployment Tax Act.
FX—Foreign corporation.
G.C.M.—Chief Counsel’s Memorandum.
GE—Grantee.
GP—General Partner.
GR—Grantor.
IC—Insurance Company.
I.R.B.—Internal Revenue Bulletin.
LE—Lessee.
LP—Limited Partner.
LR—Lessor.
M—Minor.
Nonacq.—Nonacquiescence.
O—Organization.
P—Parent Corporation.
PHC—Personal Holding Company.
PO—Possession of the U.S.
PR—Partner.
PRS—Partnership.
PTE—Prohibited Transaction Exemption.
Pub. L.—Public Law.
REIT—Real Estate Investment Trust.
Rev. Proc.—Revenue Procedure.
Rev. Rul.—Revenue Ruling.
S—Subsidiary.
S.P.R.—Statement of Procedural Rules.
Stat.—Statutes at Large.
T—Target Corporation.
T.C.—Tax Court.
T.D.—Treasury Decision.
TFE—Transferee.
TFR—Transferor.
T.I.R.—Technical Information Release.
TP—Taxpayer.
TR—Trust.
TT—Trustee.
U.S.C.—United States Code.
X—Corporation.
Y—Corporation.
Z—Corporation.

April 6, 2020 ii Bulletin No. 2020–15
Numerical Finding List
1
Bulletin 2020–15
AOD:
2020-1, 2020-12 I.R.B. 521
2020-2, 2020-14 I.R.B. 558
Announcements:
2020-1, 2020-5 I.R.B. 552
2020-2, 2020-15 I.R.B. 609
2020-3, 2020-15 I.R.B. 655
Notices:
2020-1, 2020-2 I.R.B. 290
2020-2, 2020-3 I.R.B. 327
2020-3, 2020-3 I.R.B. 330
2020-4, 2020-4 I.R.B. 380
2020-5, 2020-4 I.R.B. 380
2020-6, 2020-7 I.R.B. 411
2020-7, 2020-7 I.R.B. 411
2020-8, 2020-7 I.R.B. 415
2020-9, 2020-7 I.R.B. 417
2020-10, 2020-10 I.R.B. 456
2020-11, 2020-11 I.R.B. 492
2020-12, 2020-11 I.R.B. 495
2020-13, 2020-11 I.R.B. 502
2020-14, 2020-13 I.R.B. 555
2020-15, 2020-14 I.R.B. 559
2020-16, 2020-14 I.R.B. 559
2020-17, 2020-15 I.R.B. 590
2020-18, 2020-15 I.R.B. 590
2020-19, 2020-15 I.R.B. 591
Proposed Regulations:
REG-107431-19, 2020-3 I.R.B. 332
REG-122180-18, 2020-3 I.R.B. 342
REG-100956-19, 2020-4 I.R.B. 383
REG-125710-18, 2020-5 I.R.B. 554
REG-132741-17, 2020-10 I.R.B. 458
REG-100814-19, 2020-12 I.R.B. 542
Revenue Procedures:
2020-1, 2020-01 I.R.B. 1
2020-2, 2020-01 I.R.B. 107
2020-3, 2020-01 I.R.B. 131
2020-4, 2020-01 I.R.B. 148
2020-5, 2020-01 I.R.B. 241
2020-7, 2020-01 I.R.B. 281
2020-9, 2020-02 I.R.B. 294
2020-10, 2020-02 I.R.B. 295
2020-11, 2020-06 I.R.B. 406
2020-8, 2020-08 I.R.B. 447
2020-12, 2020-11 I.R.B. 511
2020-13, 2020-11 I.R.B. 515
Revenue Procedures:—Continued
2020-17, 2020-12 I.R.B. 539
2020-18, 2020-15 I.R.B. 592
Revenue Rulings:
2020-1, 2020-3 I.R.B. 296
2020-2, 2020-3 I.R.B. 298
2020-3, 2020-3 I.R.B. 409
2020-4, 2020-4 I.R.B. 444
2020-5, 2020-5 I.R.B. 454
2020-6, 2020-11 I.R.B. 490
2020-7, 2020-12 I.R.B. 522
2020-9, 2020-15 I.R.B. 563
2020-10, 2020-15 I.R.B. 565
Treasury Decisions:
9886, 2020-2 I.R.B. 285
9887, 2020-3 I.R.B. 302
9888, 2020-3 I.R.B. 306
9891, 2020-8 I.R.B. 419
9892, 2020-8 I.R.B. 439
9893, 2020-9 I.R.B. 449
9895, 2020-15 I.R.B. 565
1
A cumulative list of all revenue rulings, revenue procedures, Treasury decisions, etc., published in Internal Revenue Bulletins 2018–27 through 2018–52 is in Internal Revenue Bulletin
2018–52, dated December 27, 2018.

Bulletin No. 2020–15 iii April 6, 2020
Finding List of Current Actions on
Previously Published Items
1
Bulletin 2020–15
1
A cumulative list of all revenue rulings, revenue procedures, Treasury decisions, etc., published in Internal Revenue Bulletins 2018–27 through 2018–52 is in Internal Revenue Bulletin
2018–52, dated December 27, 2018.

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