Major Court Decisions and Tax Sunset Provisions: New and Noteworthy Developments in the Valuation of S Corporations
The vast majority of U.S businesses are pass-through entities (S corporations, LLCs, and partnerships). The debate over how to value them has raged in the courts and academia for decades, and understanding how to do so is important to all valuation professionals. Recent cases such as the Estate of Cecil have demonstrated that the IRS and the Tax Court will accept tax affecting only when correctly applied and supported.
Estate and Gift: The Complete Valuation Package (A BVR Workshop)
Unwrap all things estate and gift in this engaging session with Marissa Turrell and Carla Glass. This presentation will assume a basic understanding of business valuation, of both operating companies and holding companies, and focus on specifics related to valuing ownership interests for estate and gift purposes. Some topics will focus on issues that arise only in valuation for gift and estate purposes, such as seminal court cases on the matter, Chapter 14, working with ...
Tax Court resists tax affecting in Michael Jackson case
Although the U.S. Tax Court recently handed the Michael Jackson estate a decisive victory regarding the estate’s tax liability, the court did not side with the estate on tax affecting, an issue that has preoccupied valuators, many of whom are proponents of the practice, for a long time.
Valuing Shareholder Cash Flows
The integrated theory of business valuation provides a conceptual framework for disciplined analysis of valuation questions. Too often, valuation analysts are tempted to view individual components of a valuation assignment on a piecemeal basis. Adhering to the integrated theory helps valuation analysts develop base valuation conclusions, discounts, and premiums that are rooted in a shared perspective of the subject company and the subject ownership interest. In the first webinar of the three-part series, Chris Mercer ...
King v. King
This divorce case appeal deals with three primary issues: the determination of the value of insurance agency marital asset, the determination of the amount of personal goodwill attaching to the insurance agency, and the appropriate amount of alimony. The court remands the value of the business as it relates to the exclusion by the trial court of the liabilities the business owed, remands as to the appropriate amount of personal goodwill, and remands as to the erroneous level of income of the husband for determination of alimony.
Florida Trial Court’s Valuation Findings, Including Personal Goodwill Determination, Do Not Hold Up Under Appeals Court Scrutiny
This divorce case appeal deals with three primary issues: the determination of the value of insurance agency marital asset, the determination of the amount of personal goodwill attaching to the insurance agency, and the appropriate amount of alimony. The court remands the value of the business as it relates to the exclusion by the trial court of the liabilities the business owed, remands as to the appropriate amount of personal goodwill, and remands as to the erroneous level of income of the husband for determination of alimony.
Landmark Jones case featured in upcoming workshop
“Read the Jones case,” an IRS official said when asked about the position the IRS is taking on tax affecting pass-through entities.
BVU News and Trends February 2020
A monthly roundup of key developments of interest to business valuation experts.
BVU News and Trends November 2019
A monthly roundup of key developments of interest to business valuation experts.
EY study examines TCJA impact on S corps
The Tax Cuts and Jobs Act (TCJA) succeeded in maintaining rough tax parity between large pass-through businesses and large C corps but only if the 20% qualified business income (QBI) deduction is in effect and only if it’s made permanent, according to an EY study commissioned by the S Corporation Association.
Tax Court adopts tax-affected valuation of PTE without overturning Gross
For years, the appraisal community has wondered when the U.S. Tax Court will recognize the need for tax affecting when valuing pass-through entities (PTE) and how the court will square its decision with precedent, i.e., the Gross case in which the Tax Court rejected the taxpayer’s tax-affected valuation.
IRS updates QBI deduction FAQs
Under the Tax Cuts and Jobs Act, Section 199A allows taxpayers to deduct up to 20% of qualified business income for tax years 2018 through 2025.
Distinguishing Gross, Tax Court adopts tax-affected valuation of PTE
In an ingenious move, the U.S. Tax Court, ruling on an Oregon gift tax dispute, accepted the taxpayers’ tax-affected valuations of pass-through entities (PTE) without overturning Gross.
Estate of Aaron Jones v. Commissioner
In gift tax dispute, Tax Court adopts estate expert’s valuation of two related PTEs, including expert’s tax affecting; court distinguishes Gross and later cases; issue is not whether to tax affect but how; estate expert’s tax affecting was “more accurate than [IRS’] blunt zero-rate approach.”
Keeping Gross Alive, Nimble Tax Court Accepts PTE Tax Affecting
In gift tax dispute, Tax Court adopts estate expert’s valuation of two related PTEs, including expert’s tax affecting; court distinguishes Gross and later cases; issue is not whether to tax affect but how; estate expert’s tax affecting was “more accurate than [IRS’] blunt zero-rate approach.”
Move to make permanent the QBI deduction gains steam
More than 100 business groups have come out in support of new legislation to make permanent the 20% qualified business income (QBI) deduction for pass-through entities (PTEs), according to a release from the S Corp Association.
BVU News and Trends April 2019
A monthly roundup of key developments of interest to business valuation experts.
BVU News and Trends March 2019
A monthly roundup of key developments of interest to business valuation experts.
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.
Indiana Court Upholds Child Support Calculation Involving Pass-Through Entities
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.
Recording available of Hitchner’s 2018 BV highlights
Jim Hitchner (Valuation Products and Services) does an annual rundown of the prior year’s new need-to-know BV concepts, data, models, and methods (see our coverage of his latest update).
Final regs issued on PTE QBI deduction
The Treasury has issued final regulations explaining who qualifies for the new tax law’s 20% “qualified business income” (QBI) deduction for pass-through entities (PTEs).
Hitchner outlines BV highlights of 2018
During his annual update webinar, Jim Hitchner (Valuation Products and Services) does a rundown of the new need-to-know BV concepts, data, models, and methods.
New tax law gets the spotlight at the AICPA FVS conference
BVWire attended the AICPA Forensic & Valuation Services Conference November 5-7 in Atlanta where there were a number of good sessions on the Tax Cuts and Jobs Act (TCJA), which impacts “everything” in valuation.
BVU News and Trends November 2018
A monthly roundup of key developments of interest to business valuation experts.