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Blue-Sky Method in Valuing a Car Dealer—Redux

In a recent issue of the BVLaw Alert, we published a short piece about a shareholder dissent/oppression appellate decision in Tennessee regarding the valuation of a “high-end” car dealership. Our headline noted, “Court Tweaks Blue-Sky Method in Valuing a Car Dealer.” We received a question from a reader asking whether the rule of thumb blue-sky method was explained in the case. Read more >>

A Look at the Income Approach

The Cost of Capital Professional platform provides you with a comprehensive range of tools that enable you to compute cost of equity and WACC estimates easily and effectively allowing you to determine your cost of capital with minimal fuss. The income approach is one such way to approach these valuations. What follows is a selection from a comprehensive article on the topic written by Jim Alerding. Read more >>

Subsequent Transaction Used to Find Damages Without Trial in New York Case

In this surmised summary judgment as to damages, a New York trial court awarded damages to the plaintiff in a breach of contract suit. The determination of damages was made without a trial but “on paper.” Additionally, the court used a subsequent sale of the stock to determine the damages and opine that the company was “worthless.” Read more >>

Preview: Understanding Business Valuation, 6th Edition

In this exciting new edition of Understanding Business Valuation, Gary Trugman takes his characteristic talent for simplifying the technical and complex to even greater heights. In his easy-to-read and -understand style, he covers all the bases with valuation approaches, methods, and techniques. Trugman identifies critical points in his callout notes throughout the publication. Read more >>

Preview: Business Valuation Case Law Yearbook, 2022 Edition

The year 2021 was a year of change not only for the broader world, but also for the legal landscape; the U.S. ushered in a new administration with promises to increase taxes in a broad spectrum of areas, including reviving the estate tax levels to years gone by. This and the increase in litigation activity, perhaps also rebounding from the pandemic, have created an increase in the demand for business valuations and litigation services. Read more >>

New IRS Trap for GRATs When There Is a Merger Pending

The Chief Counsel office (IRS) recently released a memorandum, which comes to two primary conclusions. First, under the fair market value standard, the hypothetical willing buyer and willing seller of a company would consider a pending merger when valuing stock for gift tax purposes. Second, the retained interest is not a qualified annuity interest under § 2702 of the Internal Revenue Code (Code) because the donor used an outdated appraisal that did not take into account all the facts and circumstances of a pending merger. Read more >>

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