slides - NABE

Correlative Adjustments A working definition: Following a primary allocation under section482, consistent allocations made with respect to any other member ofthe controlled group affected by the primary allocation. Treas. Reg.§1.482-1(g)(2). Correlative adjustments are recorded in relevant documentationmaintained for U.S. tax purposes E.g., E&P of a controlled foreign corporation Correlative adjustments are mandatory, even if there is no immediateU.S. tax effect Correlative adjustments are triggered only by a final determinationwith respect to a primary adjustment made to one or more controlledparties9