Overall, tax allocation agreements should provide for the allocation and payment of the group`s consolidated tax debt, determine whether and how members are compensated when their tax attributes (e.g. B losses, tax credits) are absorbed by the consolidated group and provide for the allocation and distribution of tax refunds. If the group did not have a tax-sharing agreement, the parent company would not be required to remit the $100 refund to Subsidiary 2. If an agreement exists, it could require subsidiary 2 to be compensated if its $100 tax credit is recovered and taken over by the group (i.e. In Year 2). The agreement could also take a „waiting-and-see“ approach to the distribution of tax refunds. In accordance with the discussion below, the group would wait to see whether, subsequently, Subsidiary 2 made sufficient profits, which would have allowed it to benefit if it had not been previously absorbed by the group. . . .