The selection of transfer pricing method is very important to both taxpayers and tax authorities. Nowadays, at least five acceptable methods have been formed under the Arm’s Length Principle, which may be used by taxpayers and tax authorities to make a choice for a single case by considering the facts and circumstances in that case. The U.S. Best Method Rules is directed against the specific choices among the transfer pricing methods. The U.S. Best Method Rules is of more practical meanings than the related regulations in the OECD Guidelines for it balances principle with flexibility though there’s no essential difference between the two. Although the rules are still facing impacts and challenges from intangible assets, taxpayers’proof burden, accounting standards, etc. and these impacts and challenges made the application of this rule restricted. However, from the perspective of the author, its values can’t be ignored. The U.S. Best Method Rules is of certain enlightening significance for the perfection of the Chinese transfer pricing tax system, such as the balance between principle with flexibility, the application and innovation of the unspecified method as well as the regulation at the discretion of the tax authorities by the proportion principle