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A Busy Year for Valuation DecisionsA Busy Year for Valuation Decisions

Three important rulings in 2014

23 Min Read
A Busy Year for Valuation Decisions

The U.S. Tax Court and U.S. Court of Appeals decided several interesting cases in 2014. Here’s a rundown of three significant decisions and what they mean for clients facing valuation issues.

 

C Corporation Holding Company

In Estate of Helen P. Richmond v. Commissioner,1 the Tax Court addressed: (1) the appropriateness of using the income approach for a holding company valuation, (2) the economic impact of a contingent tax liability for built-in capital gains, and (3) the application of a substantial valuation understatement penalty for not hiring a certified appraiser. 

Helen Richmond died in December 2005 owning 23.44 percent of the outstanding shares of Pearson Holding Co. (PHC), a C corporation. PHC was formed in 1928 to manage a portfo...

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About the Authors

Timothy J. Meinhart

Timothy J. Meinhart is managing director in the Chicago office of Willamette Management Associates. He has testified as an expert witness on business, stock, and asset valuation matters. He has written for national business publications and is a contributing author to The Handbook of Business Valuation and Intellectual Property Analysis. Tim is an accredited senior appraiser (ASA) of the American Society of Appraisers, accredited in business valuation. He is a member of the business valuation committee. Tim holds a master of business administration degree, with distinction, from the Kellstadt Graduate School of Business, DePaul University. He holds a bachelor of science degree in finance from Northern Illinois University.

Heidi P. Walker

Heidi P. Walker is a director in the business valuation and litigation support group at Meyers, Harrison & Pia LLC in Portland, Maine