10 takeaways from Estate of Richmond

Estate of Richmond, 2014 Tax Ct. Memo LEXIS 26 (Feb. 11, 2014)

The Tax Court’s Estate of Richmond decision in February 2014 immediately garnered the attention of the appraisal community, in part because in the past 12 months there have been few pronouncements on valuation from the court. Some five months later, Jack Bogdanski (Lewis & Clark Law School), a scholar and long-time court watcher, took a fresh look at the decision and offered 10 takeaways in a webinar hosted by Business Valuation Resources.

Bogdanski dug into the reasons for the court’s choice of valuation method, approach to the built-in capital gains tax (BICG) discount, and view on the accuracy penalty. Why did—and could—the Tax Court reject the estate’s argument in favor of a dollar-for-dollar BICG discount when the 5th Circuit accepts this treatment? What could the estate have done to obtain a more favorable outcome? What’s the policy implication of the court’s failure to credit the estate for conceding ground to the IRS? And why does Bodganski consider the opinion “wild and woolly”?

For the answers, click here.