This appeal in a California court involved a dispute over an appraisal of the plaintiffs’ 15% interest in a grocery store the defendant operated. The plaintiffs alleged that the award of the superior court was obtained by fraud and that the arbitrator prejudiced their rights.
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In re Marriage of Rodenback
Appellate court disavows day-of-trial valuation by expert that used the husband’s “off the cuff” forecasts, preferring value based on historical earnings, without consideration of the tax burden the husband would have to bear in making the equalization pa ...
Lost Profits of S Corporation Recoverable as Lost Earning Capacity in Personal Injury Action
The Indiana Court of Appeals determined that the trial court may permit the recovery of lost profits from an S corporation as lost earnings capacity damages resulting from the injuries its sole shareholder and prime mover experienced in an automobile accident.
Application of Minority, Marketability Discounts Was Error
In this corporate dissenter's rights action, Lindoe Inc. appealed the trial court's valuation of its stock in Pueblo Bancorporation, a bank holding company.
Application of Discounts Inappropriate
The Colorado Court of Appeals considered the valuation of a bank holding company in this dissenting shareholder action. It determined that minority interest and lack of marketability discounts were inappropriate in dissenting shareholder actions as a matt ...
‘Dueling Over Discounts’ in Divorce of Minority Shareholder
Court considers the applicability of discounts to a minority shareholder’s interest in an S Corp, and whether the company’s retained earnings may be properly attributable to a minority owner for child support determinations.
Appeals Court Tiptoes Around Tax Affecting in Divorce Setting
Appeals court agrees that in valuing husband’s S corp for marital distribution “national case law” (Kessler, Bernier) supports his expert’s tax affecting but says it must defer to trial court’s decision to adopt competing expert’s position not to tax affe ...
Application of Minority, Marketability Discounts
In this corporate dissenter's rights action, Lindoe Inc. appealed the trial court's valuation of its stock in Pueblo Bancorporation, a bank holding company.
Vedros v. Vedros
Court says discounting for lack of marketability of minority interest in home healthcare agency, operating as an S corporation, is appropriate where LLC agreement included transfer restrictions and partners were not planning to buy out owner spouse.
Tax Court Criticizes Experts' Application of Market Approach and Income Approach
This was a gift tax valuation case in which the sole issue for decision was the fair market value of 9,380 shares of the company's nonvoting common stock, which the majority shareholder gifted into trusts for the benefit of his children.
Van Der AA Investments, Inc. v. Commissioner
In an income tax case where the IRS challenges the calculation of net unrealized built-in gain that has been based on a contemporaneous valuation of the assets subject to built-in gain tax, the valuation report by itself constitutes inadmissible hearsay w ...
Kress v. United States
In gift tax case requiring valuation of minority shares in S corporation, district court accepts application, by all experts, of C corp-level tax rate to company’s earnings; court, with minor DLOM adjustment, credits valuations by taxpayers’ expert, noting his market approach is “the most sound.”
Minnesota Supreme Court affirms that passive appreciation in nonmarital property is nonmarital
Earnings retained in wife’s AAA were not income because they might never be distributed, nor were the earnings active appreciation.
Tax Court Declines to Tax Affect S Corp in Gift Transfer Case
In a post-Gross decision, the Tax Court considers tax affecting S corp earnings and also discounts for lack of marketability and control.
Bright-Line Rule Barring Discounts Is Inappropriate
The Washington Court of Appeals reversed a trial court’s bright-line rule prohibiting discounts for lack of marketability and built-in capital gains taxes when determining fair value in a dissenters’ rights action.
No DLOM Absent Extraordinary Circumstances; Bright-Line Rule Prohibiting Built-in Gains Discount Rejected
The issue, in this case of first impression in Washington, was the propriety of discounts for lack of marketability and built-in capital gains in a dissenters' rights proceeding.
Hamelink v. Hamelink
Appeals court agrees that in valuing husband’s S corp for marital distribution “national case law” (Kessler, Bernier) supports his expert’s tax affecting but says it must defer to trial court’s decision to adopt competing expert’s position not to tax affe ...
Pueblo Bancorporation v. Lindoe, Inc. (I)
At issue is the valuation of shareholders stock in plaintiff, Pueblo Bancorporation.
Wright v. Wright
Court considers the applicability of discounts to a minority shareholder’s interest in an S corp, and whether the company’s retained earnings may be properly attributable to a minority owner for child support determinations.
Wall v. Commissioner
The issue was the fair market value of 9,380 shares of the company's nonvoting common stock, which the majority shareholder gifted into trusts.
High Valuations Complicate Division of Sizable Marital Estate
Appeals court affirms trial court’s above fair market value determinations regarding husband’s interests in various family businesses and the resulting equalization judgment but rejects trial court’s means with which to enforce payment of judgment.
Second Post-Bernier Court Says Income Approach May Be Preferred, But Not Exclusive
Massachusetts court precludes discounts in valuing marital business in divorce, and says that while income approach is preferred, net asset value may be appropriate in the absence of determinable market value.
Dallas v. Commissioner
In a post-Gross decision, the Tax Court considers tax-affecting S Corp earnings and also discounts for lack of marketability and control.
Zausch v. Schnakenburg
Appeals court upholds trial court’s upward adjustment of father’s child support obligation based on a significant improvement in his economic circumstances; trial court followed applicable case law when calculating income related to father’s minority interests in several pass-through entities.
In re Marriage of Williams
Montana high court rejects 35% minority discount to husband’s half interest in a closely held, family business, which he owned with his father and had equal say over operations, management, and application of funds.
Florida Rules on Inclusion of Corporation’s Retained Earnings in Income for Support Purposes
The Florida Supreme Court held that undistributed income in a pass-through business entity was not income available to the shareholder-spouse for support purposes unless the earnings were retained for improper purposes. It further held that the shareholde ...