TBL Licensing LLC v. Commissioner 158 T.C. No. 1
On January 31, 2022, the Tax Court issued the full opinion in TBL Licensing LLC v. Commissioner (158 T.C. No. 1). The primary issues presented in TBL Licensing LLC v. Commissioner were (a) whether the petitioner was required to recognize gain in the intangible property as a result of a reorganization, and (b) whether the reorganization was a disposition within the meaning of IRC § 367(d)(2)(A)(ii)(II). Background to TBL Licensing LLC v. Commissioner The deficiency in this case is $505 million. Yikes. The primary question presented was whether the petitioner recognized ordinary income as a result of a constructive transfer of intangible property to a Swiss subsidiary/holding company—and, if so, whether the intangible property should be treated as having a useful life of only 20 years. Both parties moved for summary judgment. The IRS emerged the victor. Two primary players were involved in this corporate restructuring: VF Corp (the manufacturer…