Yes! Business valuations are a must for estate and gift tax purposes. Estate valuation principles relating to business interests are in Regs. 20-2031-2 (f) and 20-2031-3. Gift tax valuation principles relating to gifts and bargain sales of a business interest are in Reg. 25.2512.3. Valuations for estate tax purposes are critical because the valuation determines the extent of federal estate taxes and tax basis of the business interest for the beneficiaries of the estate. Court cases have emphasized the need for contemporaneous valuations before filing gift and estate tax returns! These same cases stress the need for having a valuator with experience, training, and credentials.
Upon IRS challenge, a professional valuation provides strong evidence of value, if you need assistance, please call one of our credentialed professionals at (615) 822-8342 or contact us via email.