Unique Situations from Common Assignments The assessment of interest rates and appraising the value of a business are assignments not limited to bankruptcy work alone. Most financial experts are familiar with the methods required to perform these tasks. Even in the application of these basic analyses, Chapter 11 bankruptcy may present unusual assignments. This article discusses two unique situations that ma ...

Part II: Nine Additional Reasons a Valuation Is Needed in Chapter 11 This second part of the article focuses on the remaining nine reasons a valuation of IP is necessary in a Chapter 11. ...

This past summer, the firm of Pluris Valuation Advisors LLC released a detailed white paper on the valuation of life insurance. According to the authors, when valuing life insurance or life insurance-linked instruments such as split-dollar collateral assignment receivables or split-dollar promissory notes, there are only three elements of Fair Market Value. These include: Illustrations from the insurance co ...

It’s not as simple as it seems This article explores the fact that the valuation of a simple debt instrument, such as a promissory note, can be anything but simple. It is observed that the sum of unpaid debt, as well as accrued interest, may well overstate the value of the promissory note. Also covered is whether assets tied to notes need to be valued separately. ...

Garner v. Knoll, Inc.—the mathematics of a hypothetical liquidation analysis A preference payment is subject to recovery by the debtor’s estate. Having to return a “preference payment” may come as a surprise. In this case, the issue before the court is whether a creditor received far more than what it would have received under a Chapter 7 liquidation. The case illustrates the mathematics used in conducting ...

Plus: Bishop v. Commissioner Rules on When and Whether a Bad Debt Loss Can Be a Claimed Deduction In Schwab v. Commissioner, a case turns on when a variable universal life insurance policy is a taxable event.  In Boone Operations Co., LLC v. Commissioner, find out when contributing fill dirt to the city of Tucson is or isn’t a charitable or taxable event. ...

Case Summaries from the U.S. Court of Federal Claims and the Appeals Courts of the Sixth and Seventh Circuits A corporation lies in applying for federal loan guarantees—and faces treble damages in United States v. Anchor Mortgage.  In Naylor v. Invacare, plaintiff’s request for information plays a key role.  Find out more. ...

Federal Cases Examine Bankruptcy, Valuation Standards The Court of Appeals for the Eleventh Circuit weighs in on penalties for “gross valuation misstatement” in Gursthaw v. Commissioner, and the U.S. Bankruptcy Court for the Eastern District of Tennesee rules on the value of mortgage liens In re: Williams. ...

A Credit Card Debt is Settled, But Tax on DOI Income Still Due Judge Ruwe at the Tax Court finds petitioners owe tax on income from a settled credit card debt in Shepherd v. Commissioner, and a U.S. Bankruptcy Court for the Western District of Pennsylvania rules on the valuation of a mortgagee’s creditor’s secured claim in Buena Vista Oceanside, LLC., v. Optimum Bank ...