While we have periodically written about the Transfer Pricing Examination Process, Publication 5300 (TPEP) and its predecessor, the Transfer Pricing Audit Roadmap, for this blog post we revisited the TPEP to determine how well this IRS guidance and our initial insights on it have withstood the test of time relative to our field-based transfer pricing (“TP”) experience since the TPEP’s initial 29 June 2018 release. This blog post is a companion to our article “Impactful FYE Transfer Pricing Examination Preparedness Measures” in the December 2020 TGS Global AMÉRICA Regional Magazine. Following are six TPEP takeaways that we have found to be even more important today than a few years ago.
1. Robust documentation is the first and best line of defense against an IRS TP adjustment and non-deductible penalties and interest.