Misperception Over USPAP Reporting for Litigation Assignments
The author examines USPAP’s Standard 10, which contains the requirements for business appraisal reporting. There seems to be a misperception that this standard requires a lengthy narrative report in the context of a litigation assignment, but the author concludes that this is not the case.
BVR Leadership Council Perspective #1: Analysis of Proposed Changes to Circular 230 Regulations
Part of the mission of BVR’s Leadership Council is to help shape the future of the business valuation profession. The group has issued its first Perspective document, which analyzes the proposed changes to IRS Circular 230 that will impact business appraisers. This document can help practitioners craft comments that must be submitted by the scheduled deadline date of February 24.
BV News and Trends March 2025
A monthly roundup of key developments of interest to business valuation experts.
USPAP/IVS Front and Center in Proposed Regs for Tax Valuations
The IRS has issued proposed regulations that would make changes to Circular 230 that would strengthen the agency’s ability to penalize or disqualify appraisers who do tax-related valuations. Two sets of valuation standards, USPAP and IVS, figure prominently in the proposed regs as benchmarks by which the IRS will scrutinize valuations. Public comments are due February 24, and a public hearing will be held March 6.
BV News and Trends February 2025
A monthly roundup of key developments of interest to business valuation experts.
Last chance: Comments due February 24 on proposed Circular 230 changes
Comments are due Monday, February 24, on proposed changes to IRS Circular 230 that would require appraisals to be in strict compliance with the Uniform Standards of Professional Appraisal Practice (USPAP) or International Valuation Standards (IVS).
BVR Leadership Council advises on proposed Circular 230 changes
Part of the mission of BVR’s Leadership Council is to help shape the future of the business valuation profession.
Reminder: Comments due February 24 on proposed IRS Circular 230 regs
The IRS is continuing to accept public comments on proposing changes to its Circular 230 that will strengthen its ability to disqualify appraisers who do tax-related valuations.
Comments started on proposed IRS regs regarding appraisers
Last week, we alerted you to proposed changes to its Circular 230 related to appraisers who do tax-related valuations.
Comments wanted on proposed IRS regs regarding appraiser disqualification
The IRS is proposing changes to its Circular 230 that will strengthen its ability to disqualify appraisers who do tax-related valuations.
A Dozen Tips From the VSCPA Forensic and Valuation Services Conference
Business Valuation Update attends a great many conferences and webinars, but we never fail to learn something new. Yes, the topics can be the same, but, no matter how many times you hear about something, a different presenter will offer some new information or give a different perspective on it, which is very valuable. Such was the case at the recent two-day Forensic and Valuation Conference held by the Virginia Society of CPAs (VSCPA), which had an excellent mix of topics and speakers.
BV News and Trends December 2024
A monthly roundup of key developments of interest to business valuation experts.
IRS Issues New “Regulations Governing Practice Before the Internal Revenue Service” (Circular 230) Alert!
The Internal Revenue Service (IRS) has published (Federal Register, Dec. 26, 2024) new proposed regulations on practice before the Internal Revenue Service. Of particular interest to the business valuation community is Paragraph L (link here).
Should you change your models now for potential tax law changes?
No, it is not advisable to change your valuation and financial models at this time based solely on the potential for tax law changes.
AVW webcast features the Connelly case
Charles Persing (Bedersen LLP) appeared on the November edition of NACVA’s Around the Valuation World (AVW) webcast to discuss the Connelly case that came out this past June.
Connelly Lesson: A Good Buy-Sell Is Not Enough to Fix Value
Some insights on the Connelly U.S. Supreme Court case from exit planner Paul Hood and attorney Ed Morrow. In the case, the estate of a deceased owner got hit with tax penalties due to trouble over the buy-sell agreement and mandatory redemption on death that was funded with life insurance.
RESEARCH UPDATE: Monthly Recap of Research Papers October 2024
The featured paper is from 2021 but escaped our radar. The authors are Lauren A. Cooper (West Virgina University), James A. DiGabriele (Montclair State University), Richard A. Riley, and Trevor L. Sorensen (West Virgina University). Other papers examine an algorithm for PE IRR, assessing macroeconomic risk, global economic recovery from COVID-19, and the payment timing of deferred income taxes.
October 2024 issue of Willamette’s Perspectives is released
The October 2024 issue of the quarterly digital publication Perspectives, from Willamette Management Associates, has been released, and you can access it if you click here.
Gregory Reveals What’s Going on With the IRS and Tax Valuations
At the recent New York State Society of CPAs’ Business Valuation and Litigation Services Conference, former IRS manager Michael Gregory (Michael Gregory Consulting) did a session on valuations for tax purposes and what’s been happening at the IRS. The article includes a chart on DLOM methods to consider for various types of entities and situations based on IRS feedback.
Handy tool: the buy-sell options grid
In the wake of the Connelly case, the order of the day for valuation experts is to get involved in the review of buy-sell agreements.
SCOTUS Decides Valuation of Corporate-Owned Life Insurance
In a unanimous decision, the United States Supreme Court sided with the 8th Circuit and ruled that the life insurance proceeds payable to a corporation that was to be used to redeem the deceased shareholder’s stock should be included in the deceased’s estate when calculating the value of the stock the deceased owned. The redemption liability did not offset the life insurance proceeds. This article is a summary of the decision and some observations.
BV News and Trends June 2024
A monthly roundup of key developments of interest to business valuation experts.
SCOTUS sides with IRS in COLI valuation dispute
The U.S. Supreme Court has unanimously sided with the 8th Circuit and ruled that company-owned life insurance (COLI) proceeds used to redeem the deceased shareholder’s stock should be included for purposes of valuing the corporation for estate tax purposes.
Connelly v. United States (II)
The U.S. Supreme Court took on this case because of a split between two circuit courts. In the first case, Blount v. Commr., the 11th Circuit Court of Appeals reversed the Tax Court and excluded the insurance proceeds that accrued as a result of the death of the shareholder. In the Connelly case, the Tax Court once again included the insurance proceeds in the estate. The 8th Circuit affirmed the Tax Court, and the Supreme Court now unanimously affirmed the 8th Circuit, thus negating the decision of the 11th Circuit in Blount.
U.S. Supreme Court Affirms Inclusion of Corporate-Owned Life Insurance in Value of Company for Estate Tax Purposes
The U.S. Supreme Court took on this case because of a split between two circuit courts. In the first case, Blount v. Commr., the 11th Circuit Court of Appeals reversed the Tax Court and excluded the insurance proceeds that accrued as a result of the death of the shareholder since there was a binding liability to pay the proceeds to the estate of the decedent. In the Connelly case, the Tax Court once again included the insurance proceeds in the estate. The 8th Circuit affirmed the Tax Court, and the Supreme Court now unanimously affirmed the 8th Circuit, thus negating the decision of the 11th Circuit in Blount.