Large Business and International Division

Large Business and International Division
Name	Large Business and International Division
Formed	1999
Jurisdiction	United States
Parent agency	Internal Revenue Service
Headquarters	Washington, D.C.
Chief1 name	(Director)
Website	(official site)

Large Business and International Division The Large Business and International Division serves specialized taxpayers within the Internal Revenue Service, focusing on multinational corporations, large domestic conglomerates, and high-wealth entities. It administers complex tax matters that intersect with instruments and rulings from bodies such as the United States Department of the Treasury, Organization for Economic Co-operation and Development, and multilateral frameworks like the Base Erosion and Profit Shifting project. The Division operates alongside other IRS components including the Small Business/Self-Employed Division, Tax Exempt and Government Entities Division, and enforcement units linked to tribunals such as the United States Tax Court.

Overview and Mission

The Division’s mission aligns with statutory mandates from acts like the Internal Revenue Code and directives from the United States Congress, aiming to ensure compliance among taxpayers such as ExxonMobil, Apple Inc., Google LLC, Amazon, and other multinational firms. Its work interfaces with international instruments like the Multilateral Instrument and bilateral arrangements such as the United States–United Kingdom Income Tax Treaty and the United States–Netherlands Tax Treaty. Key objectives include auditing transfer pricing practices governed by standards articulated in the OECD Transfer Pricing Guidelines, addressing tax shelter schemes noted in cases involving KPMG, and resolving controversies through negotiation or litigation before bodies like the United States Court of Appeals.

Organizational Structure

Organizationally, the Division comprises specialized offices modeled on precedents from agencies such as the Securities and Exchange Commission and administrative divisions like Department of Justice Tax Division. Units cover functions analogous to the Criminal Investigation branch for coordination, but focus on civil tax compliance across sectors exemplified by Microsoft, Pfizer, General Electric, Chevron Corporation, and Walmart. Leadership roles mirror titles found in institutions like the Office of Management and Budget and include directors, regional executives, and technical advisors with expertise in areas highlighted by reports from the Government Accountability Office.

Programs and Services

The Division administers programs for large entities including prefiling agreements, advance pricing agreements (APAs) comparable to mechanisms used by Japan and Germany, and compliance campaigns inspired by initiatives from the European Commission on state aid. It provides services such as industry-lead audit teams dealing with sectors represented by Boeing, Ford Motor Company, Intel, Cisco Systems, and Johnson & Johnson. Support functions collaborate with international offices like HM Revenue and Customs and Canada Revenue Agency to implement common reporting standards similar to the Common Reporting Standard and the Foreign Account Tax Compliance Act.

Compliance and Enforcement

Enforcement activities address abusive tax structures evidenced in high-profile disputes involving firms related to Luxembourg rulings, Ireland local arrangements, and profit shifting to jurisdictions such as Bermuda and Cayman Islands. The Division uses tools informed by precedents from cases before the Supreme Court of the United States and judgments applying doctrines rooted in statutes like the Tax Cuts and Jobs Act of 2017. Coordination with investigative partners includes entities like the Federal Bureau of Investigation, Department of Justice, and foreign counterparts in matters paralleling probes into transfer pricing and tax avoidance by corporations such as Starbucks and Glencore.

International Operations and Tax Treaties

International operations rely on treaty law exemplified by agreements such as the United States–China Tax Treaty negotiations, mutual legal assistance instruments, and dispute resolution procedures similar to those in the United Nations Convention on International Settlement Agreements. The Division engages in treaty interpretation aligned with guidance issued by the OECD and bilateral treaty partners including France, Switzerland, Singapore, and Australia. It participates in multilateral forums like the G20 to address initiatives on global minimum tax proposals advocated in policy papers referencing entities like the International Monetary Fund and the World Bank.

Outreach and Partnerships

Outreach efforts include cooperating with professional bodies such as the American Institute of Certified Public Accountants, Chartered Institute of Taxation, and industry associations including the Business Roundtable and the International Chamber of Commerce. The Division publishes guidance and holds forums similar to conferences hosted by Harvard Law School, New York University School of Law, and think tanks like the Brookings Institution and Tax Foundation. Partnerships extend to academic centers at institutions such as Columbia University, Stanford University, Georgetown University, and technical collaboration with foreign revenue services in Germany and Japan.

Criticisms and Reforms

Criticism of the Division echoes debates documented in reports by the Government Accountability Office and analyses by commentators in outlets referencing cases involving Apple Inc. and Amazon, asserting issues of audit selection, resource allocation, and transparency. Reform proposals draw on legislative initiatives from United States Congress members and white papers from organizations such as OECD and International Chamber of Commerce, recommending measures akin to enhanced data analytics platforms used by Financial Crimes Enforcement Network and strengthened advance pricing protocols similar to reforms pursued by France and Germany. Ongoing reforms consider lessons from litigation in tribunals like the United States Tax Court and policy shifts reflected in amendments to the Internal Revenue Code.

Category:Internal Revenue Service