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Business Valuation Articles

 

Profits Interest Awards Require Business Valuation Expertise

Profits Interest Awards Require Business Valuation Expertise

Posted by Douglas Sosnowski on March 02, 2020

Equity-based compensation can help businesses attract and retain qualified employees. Limited liability companies (LLCs) can issue a special kind of equity-based compensation known as a “profits interest,” however, a business valuation professional is essential to determine the value of these ownership interests for tax and accounting purposes.

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Should Subsequent Events Be Factored into the Valuation Equation?

Should Subsequent Events Be Factored into the Valuation Equation?

Posted by William P. Allen on February 18, 2020

When valuing a business interest for federal transfer tax purposes, it's usually taboo to consider events that happen after the valuation date. But there are two important exceptions to this general rule: 1) subsequent events that are “reasonably foreseeable,” and 2) unforeseeable subsequent events that provide an “indication” of value.

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How Financial Experts Can Help in Divorce

How Financial Experts Can Help in Divorce

Posted by Louis Cercone, Jr. on February 04, 2020

Divorce involves complex financial issues. A financial professional can help the parties resolve such matters as divvying up a marital estate and valuing private business interests. 

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Six Common Valuation Pitfalls in Shareholders’ Agreements

Six Common Valuation Pitfalls in Shareholders’ Agreements

Posted by William P. Allen on January 21, 2020

The purpose of a buy-sell agreement is to ensure a smooth transfer of ownership and avoid disputes over the buyout price when an owner dies or leaves the business.

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Estate of Jones: Valuing Gifts of LP Interests in Income-Producing Real Estate

Estate of Jones: Valuing Gifts of LP Interests in Income-Producing Real Estate

Posted by Douglas Sosnowski on January 07, 2020

The U.S. Tax Court addressed several key business valuation issues in a recent gift tax case.

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Three Reasons to Use Valuation Pros in Estate Planning

Three Reasons to Use Valuation Pros in Estate Planning

Posted by Louis Cercone, Jr. on December 17, 2019

Some business owners design their estate plans without consulting a business valuation professional, but do-it-yourself valuations can be risky.

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How Do Non-Operating Assets and Liabilities Affect Business Value?

How Do Non-Operating Assets and Liabilities Affect Business Value?

Posted by William P. Allen on December 03, 2019

When valuing a business, it’s important to identify nonoperating assets and liabilities that may have a significant impact on value.

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Telfer v. Telfer: Discount for Lack of Marketability Upheld on Appeal

Telfer v. Telfer: Discount for Lack of Marketability Upheld on Appeal

Posted by Louis Cercone, Jr. on November 19, 2019

Courts are divided on whether to allow discounts when valuing business interests in shareholder disputes and divorce cases. Whether discounts are equitable typically depends on state law, case facts and, ultimately, the court’s discretion.

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To Tax Affect or Not to Tax Affect? Federal Case Reviews the Tax-Affecting Debate for Pass-Through Entities

To Tax Affect or Not to Tax Affect? Federal Case Reviews the Tax-Affecting Debate for Pass-Through Entities

Posted by Louis Cercone, Jr. on October 22, 2019

In Kress v. United States, a federal district court accepted the practice of tax affecting the earnings of so-called “pass-through” entities. It also rejected the application of a premium to reflect the tax advantages of owning a minority interest in a pass-through business.

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Adjusted Deal Price or Unaffected Market Value? Delaware Supreme Court Reverses “Fair Value” Ruling

Adjusted Deal Price or Unaffected Market Value? Delaware Supreme Court Reverses “Fair Value” Ruling

Posted by Louis Cercone, Jr. on September 17, 2019

Delaware’s Supreme Court recently struck down a controversial statutory appraisal decision in Verition Partners Master Fund Ltd. v. Aruba Networks, Inc.

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