Income derived from the use of intangible property has significantly increased over time with the evolution of technology and the growing number of commercial transactions between multinational enterprises. Today, intellectual property is widely used in the context of income-generating activities including, but not limited to, technical, scientific research and the creative expression of artistic concepts. The imposition of U.S. taxes on certain income earned by foreign entities and the allowance of foreign tax credits to domestic entities requires identification of the geographic origin of income. However, in the realm of transactions involving intellectual property, identifying geographic origins of income poses particularly difficult conceptual issues. This is primarily due to the problems associated with characterization and sourcing of income derived from intangible assets as opposed to sourcing income generated from economic transactions involving tangible property. Therefore, expanding the use of intellectual property in cross-border transactions has invariably complicated the U.S. tax regime