Supreme Court Upholds 40 Percent Valuation Misstatement Penalty Reviewed by Momizat on . [caption id="attachment_12637" align="aligncenter" width="640"] US Supreme Court[/caption] The U.S. Supreme court recently upheld the 40 percent penalty in gros [caption id="attachment_12637" align="aligncenter" width="640"] US Supreme Court[/caption] The U.S. Supreme court recently upheld the 40 percent penalty in gros Rating: 0
You Are Here: Home » QuickPress » Supreme Court Upholds 40 Percent Valuation Misstatement Penalty

Supreme Court Upholds 40 Percent Valuation Misstatement Penalty

US Supreme Court

US Supreme Court

The U.S. Supreme court recently upheld the 40 percent penalty in gross valuation misstatement when the partnerships involved were determined to be shams with no economic substance and as such, the partners’ outside basis in the partnership was zero.  The unanimous decision, written by Justice Scalia, resolved a split among the circuit courts as to whether the penalty applied.  The Fifth Circuit Court, where the case originated, and the Ninth Circuit held that the penalty did not apply when the transaction had been disregarded on the grounds of economic substance.  The ruling also settled a disagreement among the courts as to whether district courts have jurisdiction to determine whether the penalty applies in a partner-level proceeding.  For full details of the case involved in this highly important ruling, please visit the Journal of Accountancy.   

Read Full Story

The National Association of Certified Valuators and Analysts (NACVA) supports the users of business and intangible asset valuation services and financial forensic services, including damages determinations of all kinds and fraud detection and prevention, by training and certifying financial professionals in these disciplines.

Number of Entries : 1424

©2017 NACVA and the Consultants' Training Institute • (800) 677-2009 • 5217 South State Street, Suite 400 Salt Lake City, UT USA 84107

event themes - theme rewards

UA-49898941-1
lw