What is a "secondary adjustment"?
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Tax Professional Answers
Michael Kalson, PhD
Say a buyer paid $50 over the arm’s length price for a good. A primary adjustment will require the seller to pay the buyer back that $50 he overcharged him. But in the meantime, the seller was reaping the benefits of that $50 that really belong to the buyer. So a secondary adjustment would require the seller to transfer over the interest earned on that $50, or any other benefits that would have accrued to the buyer, and the buyer would owe the tax on those benefits to his country.
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302 weeks ago