Promissory notes are commonly used for the transfer of wealth between family members or their legal entities, like trusts, limited partnerships and corporations. Sometimes, these notes are issued to make a loan to a son or daughter to buy real estate or to fund a...

The appraisal of promissory notes is an area of business valuation that has not received much attention from academic journals.  Large privately held notes ($25M+) can be compared to corporate bonds but most notes are much too small and nonmarketable for this type of...

Business appraisers around the country have historically used comparisons to the averages found in restricted stock studies to determine a discount for lack of marketability in their valuations of a privately held, noncontrolling interest in a business. While the...

Among other final outcomes, there’s a very real chance increased tax costs will be instituted in 2017 for transferring interests in family-owned entities.

The Internal Revenue Service released proposed regulations on August 2, 2016, that would modify and expand Internal Revenue Code § 2704, which affects the valuation of privately held minority interests that are controlled by the same family.

The widespread use of Family Limited Partnerships (FLP) among taxpayers is due to its effectiveness for asset protec- tion, dispute resolution, and favorable tax benefits for...

So, if a taxpayer wants to avoid the attention of the IRS, here are a few easy steps: 1. Formally transfer the assets to the FLP at formation and legally hold any real estate or brokerage accounts in the name of the...

Family limited partnerships are popular with taxpayers due to their effectiveness in asset protection, and favorable tax benefits for gifting.  The IRS, however, has not been fond of them.

Marketability is defined in the International Glossary of Business Valuation Terms as “the ability to quickly convert property to cash at minimal cost.” How to best quantify and support a discount for lack of marketability (DLOM) for a non-controlling interest has...

The vast majority of business appraisers still rely on the restricted stock studies to determine a discount for lack of marketability (DLOM) in their standard practice of valuing a closely held, non-controlling interest.