The IRS has done an “about face” and will now enforce a stock-based compensation (SBC) rule. The Large Business and International (LB&I) division has formally withdrawn its 2018 directive involving SBC in cost-sharing arrangements. It has provided new instructions for examiners on transfer pricing issue selection related to these arrangements. The directive’s withdrawal was based on the recent 9th Circuit U.S. Court of Appeals decision in “Altera.” The court found that the IRS hadn’t exceeded its authority in that case. Last year, after an earlier court case, the IRS told examiners to stop opening new examinations for related issues.