On 7 June 2019, the U.S. Court of Appeals for the Ninth Circuit issued its second decision (opinion) in the case of Altera Corp. v. Commissioner of Internal Revenue concerning whether regulation 26 C.F.R. § 1.482-7A(d)(2) on stock-based compensation and cost-sharing arrangements is valid. The regulation was finalized in 2003 and requires participants in qualified cost-sharing arrangements to share stock-based compensation costs to achieve an arm's length result.
The first decision on the ca…