Valuation Discounts in Peril

We are very concerned that the window for taking advantage of valuation discounts may be closing.  In January 2009, House Bill 436 was introduced by Rep. Earl Pomeroy (D-N.D.), ostensibly to fix the estate tax exemption amount at 3.5 million dollars.  However, that Bill also attempts to eliminate valuation discounts for lack of marketability and/or minority interest for family entities (partnerships, LLCs, corporations) which own investment type assets.  The legislation is currently in the Ways and Means committee and will likely be taken up by Congress this fall.  Combined with talk of a new regulatory framework governing valuation discounts, and seemingly ever increasing scrutiny placed on such discounts by the IRS, there is little doubt that there will soon be a change in the law governing valuation discounts for estate planning purposes.  Individuals that wish to take advantage of the current law through use of family entities, sales to defective grantor trusts, and/or other estate planning techniques should act now.

Please call or email Hoffman & Associates today, and let us know how we can help you.

404.255.7400

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