The use of carried interests for wealth transfer planning by GPs can produce impressively successful results in shifting their wealth to future generations.

The use of carried interests for wealth transfer planning by GPs can produce impressively successful results in shifting their wealth to future generations.

Even during a unique market dynamic involving when every new twist and turn seems “unprecedented”, the capabilities of the third-party appraiser makes the valuation process more digestible and the end-result more defensible.

Planning for the possibility of increased tax rates, whether income, capital gains, or estate and gift taxes, is prudent

When selecting a 409A valuation provider, the cost of the analysis as well as the potential opportunity cost to the option recipients should be considered. The upfront cost of the valuation may be insignificant compared to the loss of future payout that results from hiring the wrong valuation provider.

Any non-publicly traded asset that will be contributed to the GRAT would need to be valued by a valuation specialist. The IRS can – and will – take issue with taxpayers over the “correct” value of the reported assets. Therefore, being able to establish and support the value of these assets is essential.

Buy-sell provisions should be reviewed regularly, especially when there are changes in ownership dynamics or in the business environment. Combining insights from both an attorney and business valuation expert in creating or revising such agreements will reduce conflicts, confusion, and costs when the agreement inevitably comes into play.

Tim demonstrates his decades-plus years of experience focusing almost exclusively on venture-backed company valuations – a rarity in the valuation world.

Learn more about purchase price allocations and the process of assigning a fair value to all the assets acquired and liabilities assumed of an acquired company.

When everything you own is on the line, equity is a concept you will become intimately acquainted with.