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Multidisciplinary Alternative Investment Valuation and Financial Advisory Firm Transparently Serving the Full Range of Attorneys, Asset Managers, CFOs, and CPAs TM

NAV Valuation & Advisory LLC - Alternative Investment Valuation & Financial Advisory Firm

Cutting-Edge Alternative Investment Valuation and Financial Advisory Firm Transparently Serving the Full Range of Asset Managers, Attorneys, CFOs, and CPAsTM

View the 1-minute Firm Overview Introduction and Recent TV Interviews

Justin Kuczmarski,
MBA, CPA, CVA, CIRA, ABV
President

Tax Valuations: Estate & Gift Tax

 

In planning the long-term and immediate needs for your business, there often will be significant tax consequences. The needs for a highly defendable tax appraisal is important in the planning of gift / estate taxes, family limited partnerships (FLPs), and multi-generational trust interests. 

In the face of heightened scrutiny, particularly given the IRS' highly controversial proposed 2016 deadline for eliminating valuation discounts, advisors and business owners are well-served demanding cutting-edge valuation opinions authored by leading experts. NAV specializes in sophisticated and high-profile tax valuation assignments stemming from our tax practice serving affluent families and high-net worth individuals. 

Our valuation experts possess deep experience defending their analysis before IRS engineers, the official term for IRS valuation specialists. 

In addition, we have successfully defended our analysis on multiple occasions before the U.S. Tax Court. Our team flourishes within tax controversy assignments even the most seasoned valuations experts will avoid. 

We stand behind our rigorous analysis, real-world M&A experience, and record of effectively communicating with the IRS in defense of the firm's independent valuation opinions. We welcome the scrutiny rather than run from it. It is just that simple.

Client Example # 1: Famous NYC Developer

 

NAV's team spent several years defending over 75 business appraisals rendered for a leading New York City real estate magnate who owned a portfolio of nearly 40 landmark office buildings in New York City and Florida.

We successfully defended our analysis as the size of the undiscounted Estate, valued at close to $1 billion, automatically triggered an estate and gift tax audit.

We worked closely with the Estate, tax legal advisors, and the IRS in delivering additional empirical data for our conclusions and explaining our analysis of the portfolio and business structure.

Our original approach and methods were substantiated, and we provided access to work paper support for enhanced transparency and communication with the IRS. 

Client Example # 2: Warehouse Valuations 

 

NAV's team advised on a sizable portfolio of warehouses as a result of owner death in late September 2008. This September 2008 date of death (initial valuation date) was at the height of the financial crisis, and at first glance the Estate appeared poised to use this date to capitalize on diminished values stemming from the Great Recession.

After a detailed analysis of property conditions and the M&A landscape, we advised the Estate's legal team to consider exploring the available alternative valuation date six months later. Why? Real estate conditions were continuing to decelerate heading into 2009. In addition, our data revealed the dim outlook for industrial warehouses appeared to have no immediate end in sight. This decline eventually steamed through 2008 and into 2009.

In summary, we applied our expertise in real estate financial advisory in advocating for this March 2009 alternative valuation date. While the Estate could have elected either September 2008 or March 2009, our influence pushed this decision to elect the alternative valuation date of March 2009. This date eventually saved the Estate tens of millions in estate taxes since warehouse property values had declined an additional 30% from the beginning of September 2008 to the height of the financial crisis in March 2009.  

The lower supported values in March 2009 implied lower estate taxes, and our ability to supply industry expertise and valuation acumen combined to preserve family wealth and liquidity.