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Jurisdictional review reveals infrequent use of the profit split method among US corporate taxpayers, indicating primary reliance on advance pricing agreements for complex transfer pricing.
The United States has robust rules and some case law dealing with the profit split method (PSM). US taxpayers use the method relatively rarely, but most commonly in the context of advance pricing agreements. This article is part of a special issue of the International Transfer Pricing Journal on the application of the PSM across jurisdictions. The other articles include the General Report and contributions on Belgium, France, Germany, Ireland, Italy, Korea, the Netherlands, Portugal and Spain.
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Schafroth et al. (2026) studied this question.
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