SECTION 7. ELECTION TO APPLY

SECTION 965 TO A TAXABLE YEAR

In general, a taxpayer elects to apply section 965 to a taxable year by filing Form 8895 with its timely-filed tax return (including extensions) for such taxable year. If, however, a taxpayer files its tax return

.07 Advertising and Marketing Expenditures

Expenditures incurred on advertising or marketing with respect to trademarks, trade names, brand names, or similar intangible property are permitted investments, provided the advertising or marketing activities are performed in the United States. If the advertising or marketing activities are performed partly within and partly without the United States, the amount that constitutes a permitted investment shall be determined under the principles of §1.861–4(b)(1). As is the case with research and development (discussed in section 5.04 of this notice), the advertising or marketing expenditures must be borne by the taxpayer, but the advertising or marketing activities need not be performed by employees of the taxpayer.

.08 Intangible Property

Expenditures to acquire the rights to intangible property, through purchase or license, are permitted investments to the extent the rights to the intangible property are used in the United States.