Question

which of the following is not part of the documentation for claiming the reasonable cause exception from a penalty for substanial valuation misstatement due to an irc 482 adjustment? A. basic transfer pricing analysis conducted by the taxpayer B. leaned treaties on transfer pricing theory C. background documents D. disclosure of the method used o a timely filed tax return

Answer 1

Answer:

Given data:

which of the following is not part of the documentation for claiming the reasonable cause exception from a penalty for substanial valuation misstatement due to an irc 482 adjustment?

(A) : Basic transfer pricing analysis conducted by the taxpayer

(B) : leaned treaties on transfer pricing theory

(C) : Background documents

(D) : Disclosure of the method used o a timely filed tax return.

Answer for the Given data:

As per Treasury Regulations § 1.6664-4:

Sensible reason and great confidence special case, every such archive which help charge experts to comprehend that the valuation misquote was because of a sensible reason and that the citizen acted in accordance with some basic honesty while doing such valuations, the punishment isn't stated.

To make compelling the above condition, documentation should be prove.

The documentation is separated into two sections –

(1) : Primary documents and

(2) : Background documents.

Options (a) and (d) forms part of primary documents and

option (c) is another type.

Therefore, option (b) i.e.

Learned treaties on transfer pricing theory is the correct option .