Estate and Gift Tax Appraisal
While owners of closely-held companies devote much of their careers to building their businesses, they face the prospect of paying out substantial portions of their personal wealth to federal and state governments through estate taxes. The estate tax difficulties of these owners are amplified by the fact that the business interests are illiquid and typically comprise a significant portion of their estates.
Estate planning professionals have developed a number of techniques to mitigate the effects of these taxes and at the same time further the non-tax objectives of the business owner. These techniques include the use of:
- Family limited partnerships
- Gifts and charitable donations
- Limited liability companies (LLCs)
- Buy-sell agreements
- Life insurance
The effective application of these estate and gift appraisal techniques requires sound, reliable valuations of the underlying closely-held business interests or assets. When an estate contains a closely held-business interest or asset, a defensible and accurate valuation can reduce the likelihood of a long, drawn-out battle with IRS. We have assisted in IRS audits and have differentiated our valuation deliverable to incorporate additional methodologies prescribed by IRS that many other valuations fail to consider and address.