What would you do?

The decedent was an extremely wealthy man, with a net worth in excess of $3 billion. You are the executor of his estate.

Prior to his death in 2009, he retained one of the top tax firms in the country to review his existing estate plan.

Under his existing plan, which

A law suit was recently filed against the U.S. in which the Taxpayers seek a refund of gifts taxes and interest that they claim were erroneously assessed against them by the IRS for their 2007, 2008 and 2009 tax years (the “Tax Years”).

Although it may be some time before the Taxpayers’ claims are resolved, the factual setting upon which the disputed taxes are based is a commonly recurring one.

It is also one that highlights the importance of recognizing the various contexts in which the equity interests in a closely-held business are valued, how they may impact one another, and the importance of being able to distinguish among them.

Family Transfers

Taxpayers are shareholders of Company, an S corporation, the shares of which (the “Shares”) are owned by members of the Taxpayer Family and certain key employees and directors of Company.

Continue Reading Fair Market Value? For What Purpose?

Passive Activity Losses

The “passive loss rules” are aimed at preventing individual taxpayers from using their losses from passive activities to offset their income from active businesses. The rules operate by “disallowing” the current deduction of passive losses – the excess of an individual taxpayer’s losses from passive activities for the year over his or