Willamette Perspectives
January 2024
Editors for this issue: Justin M. Nielsen, Director of our Portland office and Lisa H. Tran, Vice President of our Portland office.
The Applicability of Discounts for Lack of Marketability on Controlling Ownership Interests
Lerry A. Suarez and Eliza Jones
The applicability of a discount for lack of marketability (“DLOM”) in the valuation of controlling ownership interests of closely held companies has been debated in various courtrooms across the United States. Typically, an analyst determines whether a DLOM is applicable when valuing a controlling interest based on qualitative and quantitative factors. However, judicial acceptance of applying a DLOM on controlling interests has varied with each state, and it is important that the valuation analyst be aware of applicable case law within the relevant governing jurisdiction regarding this issue.
Higher Interest Rates and Tax Exemptions May Maximize Benefits in Gift and Estate Tax Planning
Lisa H. Tran
Lower business values driven by higher interest rates and higher tax exemptions included in the Tax Cuts and Jobs Act provide high-net-worth taxpayers with an opportunity to transfer assets without incurring a significant gift and estate tax liability.
Key Person Considerations When Valuing Private Companies in a Gift and Estate Tax Context
Justin M. Nielsen
In a gift and estate tax context, the valuation analyst may consider potential company dependence on one or two key individuals when estimating the value of a private company or an interest in a private company. This dependence is generally referred to as “key person risk,” which is recognized within the valuation profession and by the U.S. Tax Court as a relevant company-specific risk characteristic. This company-specific risk characteristic can be accounted for in many ways within a valuation analysis for gift and estate tax purposes.
Willamette Insights and Perspectives Back Issues
October 2023 Perspectives
Editor for this issue: Weston C. Kirk
- Preferred Equity in a Rising Interest Rate Environment By Ben R. Duffy and Jacob L. Hudson
- Considerations for Valuing the Stadium Seat Licenses of Sports Teams for Estate Tax Purposes By Jackson Crispin
- Convertible Bonds as a Component of a Company’s Capital Structure By Keegan M. Pando and Weston C. Kirk
July 2023 Perspectives
Editor for this issue: Timothy J. Meinhart
April 2023 Perspectives
Editor for this issue: Charles Wilhoite and Scott Miller
Winter 2023: Best Practices
Editor for this issue: Robert F. Reilly, CPA
Transfer Tax Valuation Thought Leadership
Damages Measurement Thought Leadership
Property Appraisal Thought Leadership
Fair Value Measurement Thought Leadership
Valuation, Damages, and Transfer Price Thought Leadership
Reasonableness of Compensation Analysis Thought Leadership
Autumn 2022: Thought Leadership in Wealth Transfer Valuation Issues
Editor for this issue: Weston C. Kirk
Estate and Gift Tax Planning Thought Leadership
- Economic Uncertainty: A Certain Time to Reevaluate and Estate Plan (Emily A. Dabney, Esq)
- Understanding the Grantor Retained Annuity Trust (John H. Sanders Jr. and Dakota K. Ask)
- Disguised Dividends and Shareholder/Employee Compensation (Eliza Jones and Lisa H. Tran)
- Valuation of Promissory Notes for Transfer Tax Purposes (Timothy C. Ladd)
- Valuation Considerations for Preferred Equity Interests (Ben R. Duffy and Aiden B. Gonen)
- Climate Change and Business Valuation (Barry W. Purnell)
- Estimating the Blockage Discount in the Fair Market Value of Publicly Traded Company Restricted Stock (Chad M. Kirkland)
Income Tax Thought Leadership
Bankruptcy Thought Leadership
Summer 2022: Thought Leadership in Professional Practices and Licenses Valuation, Damages, and Transfer Price Analyses
Editor for this issue: Samuel S. Nicholls
Professional Practice Valuation, Damages, and Transfer Price Thought Leadership
- Professional Practice Intellectual Property Valuation, Damages, and Transfer Price Analyses (Nicholas J. Henriquez and Robert F. Reilly, CPA)
- Valuation of Professional Licenses and Other Individual Intangible Assets (Nathan P. Novak and Robert F. Reilly, CPA)
Professional Practices and Licenses Valuation Thought Leadership
Income Tax Thought Leadership
Winter 2022: Thought Leadership in Unit Valuation Principle Property Tax Appraisals
Editors for This Issue: Connor J. Thurman and John C. Ramirez
Intellectual Property Valuation
- Valuation Adjustments related to the Use of Capital Market Data in Developing Unit Principle Property Appraisals (John C. Ramirez, Robert F. Reilly, CPA, and Charlene M. Blalock)
- Intellectual Property Valuations for Property Tax Purposes (Barry W. Purnell, Robert F. Reilly, CPA, and Charlene M. Blalock)
- The Property-Specific Risk Premium and Unit Principle Property Appraisals (Connor J. Thurman and Robert F. Reilly, CPA)
- Common Misconceptions regarding the Measurement of Obsolescence in Unit Principle Appraisals (Connor J. Thurman and John C. Ramirez)