Willamette Perspectives

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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.

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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.

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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.

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Willamette Insights and Perspectives Back Issues

October 2023 Perspectives

Editor for this issue: Weston C. Kirk

October 2023 Perspectives Cover

July 2023 Perspectives

Editor for this issue: Timothy J. Meinhart

July 2023 Perspectives Cover

April 2023 Perspectives

Editor for this issue: Charles Wilhoite and Scott Miller

April Perspectives cover

Winter 2023: Best Practices

Editor for this issue: Robert F. Reilly, CPA

Willamette Management Advisors Winter 2023 Insights

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

Willamette Management Advisors Autumn 2022 Insights

Estate and Gift Tax Planning Thought Leadership

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

Willamette Management Advisors Summer 2022 Insights

Professional Practice Valuation, Damages, and Transfer Price Thought Leadership

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

Willamette Winter 2022 Insights Cover Page

Intellectual Property Valuation

Federal Income Tax Thought Leadership