NACVA Present at the Congressional Hearings on the Proposed Regulations In 2015, the IRS issued proposed section 2704 regulations. The proposal would severely impact valuations of family held businesses that are the subject of gifts. On December 1, 2016, hearings were held in Congress regarding the impact of the proposed regulations. NACVA members, Peter Agrapides, Robert Grossman, and Mark Hanson testified at the hearing. In this article, Mr. Agrapides shares some of what occurred at the Congressional hearing.
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What NACVA is Doing to Protect Our Industry On August 4, 2016, the U.S. Treasury in lock-step with the Internal Revenue Service (IRS) published Proposed Treasury Regulation 163113-02 (hereafter, the “proposed regulations”) which intend to drastically alter the application of current Internal Revenue Code §2704, particularly as it applies to valuations of family owned businesses and family farms. The proposed Treasury regulations were long-expected and released nearly a year beyond when they were first intended to be released. However, along with the late release, the proposed regulations contain a very short fuse as they intend to put these new rules…
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On Monday, September 26, Chris Mercer presented a webinar in which he examined the recently Proposed Changes to Section 2704 of the Internal Revenue Service Code from business and valuation viewpoints. To download the webinar, slides, and whitepaper from Mercer Capital’s Financial Reporting Blog, click: Recent Webinar on Proposed Changes to Section 2704. This article is republished from Mercer Capital’s Financial Reporting Blog. It is reprinted with permission. To subscribe to the blog, visit: http://mercercapital.com/category/financialreportingblog/.
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It is clear that the DOT/IRS are attempting, through Proposed Changes to Section 2704 of the Internal Revenue Code, to eliminate minority interest discounts and marketability discounts (DLOMs), even though those terms are not mentioned at all. To address the valuation side of things, Chris Mercer, founder and CEO of Mercer Capital, wrote a whitepaper outlining his thinking on valuation implications in some detail. To read the full article and download the whitepaper on Chris Mercer’s blogsite, click: Valuation Implications of the Proposed Changes to Section 2704: Good News or Bad News? Maybe Not so Bad. This article is republished…
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FLPs Remain a Viable Intra-Family Transfer Option, But Act Now The Internal Revenue Service has floated the idea of making regulatory changes to the implementation of section 2704, in this article the author gives us an update on the subject and underscores the need to facilitate intra-family transfers of businesses.