IRS Compliance & PenaltiesAnswered

Which services are NOT allowed under the Services Cost Method? Where is the line for 'cost-only'?

T9
thiago_9d41new member
May 15, 2026 1,490 views 1 answer
transfer-pricingservices-cost-methodexcluded-activitiesbusiness-judgment-rulesection-1-482-9

I understand the Services Cost Method lets me charge some intercompany services at cost. But I want to charge my US LLC for a bunch of things my home-country team does — some of it is bookkeeping and IT, but some is product design, marketing strategy, and helping arrange financing. Which of these can ride along at cost under SCM, and which are off-limits? I don't want to lump everything into one 'support fee' and have it blow up.

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