FIN 48 reporting requirements for a TNC’s uncertain tax positions (UTPs) have been
described as ‘‘an open invitation for transfer pricing audits in several countries’’ (Verlinden,
Muro, Tolia, and Gonzalez Carcedo 2010, 42) because transfer pricing transactions create some
of the most significant UTPs faced by TNCs. FIN 48 has also triggered the Internal Revenue
Service’s (IRS) requirement that large TNCs report and rank existing UTPs on Form 1120
(hereafter, Schedule UTP) immediately, with reporting by smaller TNCs to be phased in over
several years. T