Altera Corporation & Subsidiaries v. Commissioner of Internal Revenue

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26 C.F.R. 1.482-7A(d)(2), under which related entities must share the cost of employee stock compensation in order for their cost-sharing arrangements to be classified as qualified cost-sharing arrangements and thus avoid an IRS adjustment, was not invalid under the Administrative Procedure Act (APA). The Ninth Circuit reversed the tax court's decision declaring 26 C.F.R. 1.482-7A(d)(2) invalid and held that the challenged regulation was not arbitrary and capricious, but rather a reasonable execution of the authority delegated by Congress to Treasury. Therefore, the regulation was entitled to Chevron deference. View "Altera Corporation & Subsidiaries v. Commissioner of Internal Revenue" on Justia Law

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