Playing the Valuation Game—Tax Savings & Successful Intra-Family Transfers

Valuation is a core concept in taxation, as it's used to determine both income and transfer tax consequences of a wide variety of property and business transfers (gift, estate, generation-skipping transfer taxes). Many disputes with the IRS have occurred over "fair market value." These disputes can involve the deductibility of compensation, deductibility of rent payments to related parties, charitable contributions, real estate and fractional interests, conservation easements, and non-public securities, such as corporations, partnerships, and limited liability companies. Even the valuation of contingent claims for estate tax inclusion and deduction purposes often is the subject of dispute.

This proactive course, with over 100 pages of text and slides, a bibliography of resources, and valuation case studies will provide participants with hands-on experience and allow the CPA, CFP® professional, and other professionals to become team members with clients and business valuation appraisers. Also, a number of "special valuation rules" will be covered, including IRC Sections 2701–2704, the use of AFR interest rates in family loans and sales. Participants will learn the basics and planning possibilities of "valuation discounts," including the built-in capital gains tax discount, minority interest discounts, and discounts for lack of marketability. Also, Owen Fiore's periodic newsletters, available without charge at www.owenfiore.com, will ensure course materials are up-to-date.

LEARNING OBJECTIVES:
Upon successful completion of this course, participants will be able to:

• Apply basic principles of valuation for tax planning and reporting purposes.
• Identify valuation issues in structuring and documenting property and entity equity interest transfers within the family or involving non-family key employees of a business.
• Use the "special valuation rules" of Chapter 14 and the IRC Sec. 7872 AFR interest rate regime, and especially be able to positively plan with buy-sell agreements, deferred compensation, GRATs and QPRTs, and installment sales.
• Apply tax valuation principles to equity transfers of closely held business and investment entities, so as to reduce income and transfer tax liabilities.
• Develop planning lessons from the course review of judicial decisions, IRS regulations and rulings, as well as to take into account recent tax legislative proposals on valuation.
• Identify valuation planning opportunities and avoid pitfalls based on course content and case studies, thus expanding practitioner services to clients.