Tax Valuation Services
From estate planning to equity compensation, our team delivers precise, defensible valuations that align with the highest regulatory standards. Tax valuations offer expert, IRS-compliant valuations tailored to meet the complex needs of businesses, individuals, and families.
Whether you’re navigating 409A/ASC 718 reporting, optimizing wealth transfer strategies, or addressing other specialized tax scenarios like personal goodwill or undivided real estate interests, Withum’s Valuation Services Team provides the clarity, compliance, and strategic insights needed to ensure accurate reporting.
Common Tax Valuations
Obtaining a 409A valuation is essential when offering stock options or other forms of deferred compensation to employees. Withum’s Valuations Services Team delivers independent and defensible valuations while providing clarity and compliance. This helps your business accurately value equity compensation and achieve optimal outcomes for financial reporting and employee incentive strategies all while remaining compliant with regulations that may potentially mitigate any unnecessary tax liabilities and penalties. The team has conducted 409A valuations for clients at all stages of growth, from startups to established enterprises, ensuring compliance and safe harbor protection.
IRC 409A / ASC 718 Services include:
- Tax Compliance: If stock options are issued below FMV, the IRS could treat them as deferred compensation, leading to immediate taxation and a penalty tax. A proper 409A valuation that shows that options were issued at-the-money can help mitigate these risks.
- Setting the Strike Price: Private companies need 409A valuations to set the strike price of stock options. The exercise price must be at or above the FMV to avoid tax issues for employees when they exercise their options.
- Safe Harbor Protection: A 409A valuation offers “safe harbor” protection, meaning it is presumed valid up to 12 months barring any material event. This protects both the company and its employees from IRS scrutiny and penalties.
- Customized Solutions: We understand that every company is different, and we tailor our valuation models to reflect your unique business dynamics, growth drivers, and financial structure.
- Comprehensive Valuation Reports: Our detailed, audit-ready reports provide clear documentation of the valuation methods used.
Gift and estate valuations determine the fair market value (FMV) of assets transferred to beneficiaries, either during one’s life or upon death. Withum provides thorough, IRS-compliant gift and estate valuations to help clients navigate the estate planning process. These valuations provide clarity and strategic tax benefits, helping individuals and families preserve wealth and achieve optimal outcomes during asset transfers and estate planning.
Gift and Estate Valuation Services include:
- Expert Business Valuations: We specialize in thoroughly analyzing businesses, real estate, and other assets by leveraging appropriate valuation methodologies in IRS audits including defense of valuations performed.
- Discount Applications: Our team of valuation experts has considerable experience researching appropriate and applicable valuation discounts to minimize the taxable value of transferred assets.
- Comprehensive Reports: Withum delivers qualified appraisals and audit defensible reports that clearly document valuation methods and conclusions.
- IRS Audit Support: Our experts offer complete support during IRS audits, defending valuations and ensuring full compliance with tax laws. Withum’s gift and estate valuation services provide clarity and strategic tax benefits, helping individuals and families preserve wealth and achieve optimal outcomes during asset transfers and estate planning.
By accurately distinguishing between personal and enterprise goodwill, Withum’s team can help business owners optimize tax outcomes and maximize proceeds during business sales, particularly in asset sales involving C Corporations. Withum’s personal goodwill valuation services provide clarity and significant tax advantages, helping business owners achieve the best possible outcomes during sales and ownership transitions.
Personal Goodwill Services include:
- Personal Goodwill Identification: We specialize in identifying and quantifying personal goodwill, ensuring a clear distinction from enterprise goodwill.
- Tax Optimization: By allocating part of the purchase price to personal goodwill, we help owners reduce double taxation in C corporation asset sales.
- Accurate Valuations: Withum’s experts deliver reliable, audit-ready personal goodwill valuations tailored to the unique characteristics of each business or individual.
- Transaction Support: We provide comprehensive support during business sales, working with owners, appraisers, and advisors to maximize post-sale proceeds.
Undivided real estate interests refer to shared ownership where multiple parties hold a percentage interest in a property without physical division. These fractional interests often qualify for valuation discounts due to challenges such as lack of control, limited marketability, and partition costs. By accurately assessing fractional ownership interests and applying appropriate discounts, Withum ensures compliance with tax regulations while delivering substantial savings during property transfers.
Withum’s Undivided Real Estate Interest Valuation services can include:
- Fractional Interest Valuation: We specialize in identifying and valuing undivided real estate interests, applying appropriate discounts for lack of control and marketability.
- Tax Optimization: By leveraging valuation discounts, we help property owners minimize gift and estate tax liabilities during property transfers.
- Defensible Valuations: Withum delivers detailed, IRS-compliant reports backed by legal precedents and market analysis to support valuations.
- Estate and Wealth Transfer Planning: Our experts collaborate with families, legal advisors, and tax professionals to ensure smooth and tax-efficient property transfers.
Carried interest represents the share of profits general partners (GPs) receive after achieving a specified return threshold. Given its contingent and complex nature, Withum employs robust methodologies to ensure compliance with IRC Section 1061 (Carried Interest Taxation).
- Sophisticated Valuation Techniques: We employ methodologies such as DCF, Monte Carlo simulations, and option pricing models to deliver precise carried interest valuations.
- Comprehensive Risk Assessment: Evaluation of fund performance, industry risks, and specific agreement terms to ensure accurate valuations for reporting and tax planning.
- Regulatory Compliance: Full compliance with IRC Section 1061 and IRS safe harbor provisions, backed by audit-ready documentation.
- Audit and Tax Support: Detailed, defensible reports and support for tax filings related to carried interest, ensuring smooth audits and regulatory adherence.
Withum’s expertise in carried interest valuation ensures effective tax planning.
Withum provides expert tax valuations to help businesses and individuals optimize outcomes and ensure compliance with IRS regulations across a range of specialized tax scenarios. Whether navigating golden parachute payments under IRC Section 280G, transfer pricing for multinational corporations, or asset allocations during restructurings, our services deliver defensible and accurate valuations.
Other key tax areas include:
- 280G Analysis: We specialize in golden parachute payments, non-compete agreements, and avoiding excise tax penalties.
- Transfer Pricing (IRC Section 482) Valuations: Our experts assess intercompany transactions to align with IRS and global tax standards.
- Asset and Equity Valuations: Comprehensive valuations during restructurings, mergers, and acquisitions for accurate asset allocation and tax treatment.
- Audit-Ready Reports: Withum provides detailed, defensible, and IRS-compliant valuation reports tailored to the unique circumstances of your business.
Why Withum
Withum Valuation Services Team combines deep technical expertise, industry experience, and adherence to standards to deliver valuations that stand up to scrutiny. Our valuation experts hold multiple finance certifications, including CFA, CPA, ABV, and ASA.
Whether it is navigating complex equity compensation reporting, optimizing wealth transfers, or addressing specialized valuations like personal goodwill or undivided real estate interests, our team provides tailored solutions and audit-ready reports that align with IRS standards. At Withum, we are more than advisors—we are trusted partners, helping you confidently address tax complexities and make informed financial decisions with accuracy and integrity.
Contact Us
For more information or to discuss your business needs, please connect with a member of our team.
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