Assigning a value to the shares of a family business at transfer can be a challenging task. Opinions of value may differ among family members with differing agendas, and taxing authorities may have still another opinion. The valuation method and the discounts applied during this process are at times hotly contested by the parties involved. Occasionally, the final decision may lie within the courts. This uncertainty can cause unintended gift or estate tax consequences for transfers between related parties during the transferor’s life and at death.

Many tax experts have highlighted the challenges the valuation process poses to families at the time of asset transfer. However, more information needs to be shared on this subject. FEUSA plans to outline the impacts of asset valuation, along with its efforts to highlight estate tax impacts.