Agency Settlement Bureaus: Using them Effectively (Using

Pennsylvania, California & Massachusetts as a Case Study)

Kyle Sollie, Reed Smith LLPksollie@reedsmith.com – +1 215 851 8852

Mike Shaikh, Reed Smith LLPmshaikh@reedsmith.com – +1 213 457 8044

Rob Weyman, Reed Smith LLPrweyman@reedsmith.com – +1 215 851 8160

2

Massachusetts—Early Mediation Program

• Background

• Criteria for Participation

• Timing – Prior to assessment

• Amount – At least $250,000

• Developed facts and issues

• Willingness to resolve all or substantially all disputed issues

• Offsetting Issues

2

Massachusetts—Early Mediation Program (cont.)

• Pre-Mediation Action Items

• Lists of mediation participants

• Position statements

• Choice of mediator

• Mediation Day

3

Massachusetts—Early Mediation Program (cont.)

• Issues Likely To Be Accepted Into Mediation

• Transfer pricing / embedded royalties

• Sham / disregarded entities

• Issues Not Likely To Be Accepted Into Mediation

• Validity of special industry apportionment

• Throwout challenges

• Multiple issue mediation

4

5

Massachusetts—Early Mediation Program (cont.)

• Case Study: Transfer Pricing & True Debt

• Timing of mediation request

• Pre-mediation submissions

• Mediation day

• Department negotiation strategies

5

Please contact us with any questions

Kyle SollieReed Smith LLP

1717 Arch Street – Suite 3100 · Philadelphia, PA 19103ksollie@reedsmith.com+1 215 851 8852

Mike ShaikhReed Smith LLP

355 South Grand Ave. – Suite 2800 · Los Angeles, CA 90071shaikh@reedsmith.com+1 213 457 8044

Rob WeymanReed Smith LLP

1717 Arch Street – Suite 3100 · Philadelphia, PA 19103rweyman@reedsmith.com+1 215 851 8160

6www.reedsmith.com/statetax/

Reed Smith State Tax Group

7