When 50% is Not Half

You own 50% of a closely-held (not publicly traded) company that has been determined to have a fair market value of $3 million. Your ownership interest is worth $1.5 million, right? Maybe, maybe not. The value of a 100% ownership interest in a business includes the value of “control” – that is, the owner has …

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Taxpayer Victory in Personal Goodwill Case

In August of 2014, the U.S. Tax Court (the Court) made a decision in a case that addresses personal goodwill, the Estate of Adell v. Commissioner, T.C. Memo 2014-155. In this case, the decedent, Franklin Z. Adell, and his son Kevin formed The Word Network (The Word), a 24-hour television station that broadcasts urban religious …

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Greater Phoenix office market looking positive for 2016

Vacancy rates trended lower for fifth consecutive year in 2015 The chart below presents statistical data in the fourth quarter of 2015 for Class A, Class B and Class C office space in Metro Phoenix related to total inventory, vacancy, vacancy rates, net absorption, and average rental rates. Note that the Class A category had …

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When should an appraisal of a non-cash charitable contribution be performed?

Taxpayers who make charitable contributions of non-cash property could be putting themselves in IRS penalty danger if the contribution is more than $5,000 and the property has not been appraised by a qualified appraiser who has issued a qualified appraisal report. A recent Tax Court case emphasizes the need for an appraisal report to be …

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Can Shareholders of a C-Corp be Subject to Taxable Income if They are Beneficiaries of a Life Insurance Policy?

A C-Corporation should always be the owner and beneficiary of a life insurance policy to avoid taxable income to the surviving shareholders. When contemplating the manner in which to fund a buy-sell agreement, life insurance is an extremely attractive option. A life insurance policy can provide liquidity when it is needed most upon the death …

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The Estate or Gift Tax Return is Filed with the IRS – Then What?

I attended the American Society of Appraisers Advanced Business Valuation Conference a couple of weeks ago and had the opportunity to attend a session presented by an IRS attorney, Theresa Melchiorre. I always jump at the chance to hear an IRS presenter, as I like to get a glimpse of what goes on behind the …

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Valuation Services as a Management Tool

Most clients come to us for business valuation services because of outside requirements. They need an independent appraisal for tax compliance, financial reporting, marital dissolution or estate and gift planning, among other reasons. But even if you don’t have any of these needs, you might want to obtain an appraisal. Why would you want an …

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No more swiping means safer transactions, at least in person

Many of you may have received new credit cards recently which contain a small metallic square on the left front of the card. These are new EMV (Europay, Mastercard and Visa) cards which are being used to authenticate card transactions with computer chips and related technology. If you are like me, you didn’t even pay …

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Life expectancy: best and worst states to live in

If I am preparing a report on lost earnings in a wrongful death litigation matter, I will need to know what the expected remaining life would have been for the deceased subject involved with the lost earnings claim. I will use authoritative tables from government and private research sources to make the life expectancy determination. …

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Detection and Prevention of Fraud Schemes

Do you worry about the potential for fraud in your company? There is a fairly simple and affordable way to help prevent and detect fraud – through implementation of a “tip line.” Because tip lines encourage and facilitate anonymous reporting, they are a proven fraud deterrent that can be successfully implemented without burdensome effort or …

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