A Good Environment for Gifting: Taking Advantage of Low Valuations for Family Legacy Planning

/in , /by Joe Orlando

The following article, authored by Mark Weaver and Cami Fergus of Farella Braun + Martel’s Family Wealth Group, offers a timely look at gifting ownership interests during periods of low business valuations. While their examples reference vineyard and winery properties, the strategies apply equally to owners of any closely held business. The core insight is powerful: because the IRS measures gift and estate tax value at the time of transfer, a depressed market allows owners to “freeze” a lower valuation, preserve more of their $15 million individual (or $30 million combined) lifetime exemption, and remove all future appreciation from their taxable estate.

For owners of closely held LLCs or limited partnerships, the opportunity goes further. Discounts for lack of control and marketability, typically a blended discount of 25% to 40% depending on the % ownership interest gifted, reduce the taxable value of gifted interests below even the already-depressed market value. Exit Strategies Group works closely with Mark and Cami and the other attorneys at FBM to determine these discounts. We also get involved in valuing operating businesses before applying these discounts.

We encourage you to read the full article and consult with your estate planning attorney and a qualified business valuator before acting. If you are interested in learning more about gifting and family legacy planning, please give our friends Mark and Cami a call or email them.

Mark Weaver, Partner | mweaver@fbm.com  San Francisco: 415.954.4473 | St. Helena: 707.967.4151

Cami Fergus, Associate | cfergus@fbm.com  St. Helena: 415.954.4466

Farella Braun + Martel LLP — Family Wealth Group | www.fbm.com

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Read the Full Article

A Good Environment for Gifting: Taking Advantage of Low Valuations for Family Legacy Planning

https://www.winebusiness.com/news/article/318038 

Source: WineBusiness.com 

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Exit Strategies has certified appraisers business from all industries with a strong expertise in the valuation of wineries and craft beverage companies, for tax, financial reporting, and strategic purposes. If you’re exploring your options or need a valuation to support a potential exit, contact Joe Orlando at 503-925-5510 or jorlando@exitstrategiesgroup.com. We’re here to help.