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Section 482 permits respondent to make adjustments to
petitioners' Federal tax returns:
SEC. 482. ALLOCATION OF INCOME AND DEDUCTIONS AMONG
TAXPAYERS.
In any case of two or more organizations, trades,
or businesses (whether or not incorporated, whether or
not organized in the United States, and whether or not
affiliated) owned or controlled directly or indirectly
by the same interests, the Secretary may distribute,
apportion, or allocate gross income, deductions,
credits, or allowances between or among such
organizations, trades, or businesses, if he determines
that such distribution, apportionment, or allocation is
necessary in order to prevent evasion of taxes or
clearly reflect the income of any such organizations,
trades, or businesses.
In the case of any transfer (or license) of
intangible property (within the meaning of section
936(h)(3)(B)), the income with respect to such transfer
or license shall be commensurate with the income
attributable to the intangible.
Section 936(h)(3)(B) defines intangible property:
(B) Intangible property.--The term
“intangible property” means any--
(i) patent, invention, formula,
process, design, pattern or knowhow;
(ii) copyright, literary, musical,
or artistic composition;
(iii) trademark, trade name, or
brand name;
(iv) franchise, license, or
contract;
(v) method, program, system,
procedure, campaign, survey, study,
forecast, estimate, customer list, or
technical data; or
(vi) any similar item,
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