Main Issue:
Foreign Gross Receipts
Facts:
Taxpayer excluded gross receipts from foreign branches
IRS argued that foreign gross receipts were to be included
Conclusion:
The court rejected the taxpayer’s position and stated foreign gross receipts should be included
Take-Away Point:
When computing credits, needs to evaluate and understand any foreign activity and how it may impact the R&D credit
Companies with significant foreign gross receipts may benefit from the ASC calculation option
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