Proposed Regulations Would Curtail Most Valuation Discounts for Family-Owned Businesses

2016 Planning Opportunity

Recently proposed Treasury Regulations (“Proposed Regulations”), if enacted as proposed, would curtail valuation discounts that currently reduce the value of certain business interests transferred during life or at death for gift, estate, and generation-skipping transfer tax purposes. The limitation or elimination of these discounts will increase the value of a transfer of certain business interests made during lifetime, or such assets included in a decedent’s estate, in turn using more of a transferor’s lifetime gift exemption or a decedent’s estate tax exemption, or resulting in the imposition of more gift or estate tax if no exemption remains at the time of the gift or at death, as the case may be.  Read more here.