Some Helpful Tips

For those who question the validity of a VALUATION…….

For those individuals who desire to do just enough to document a file by getting sub-standard valuation work completed, such as threadbare valuations as referenced in the IRS October 1, 2008 Director Memorandum on the subject entitled Rollovers as Business Startups (ROBS) or choose to ignore the business valuation as being a compliance requirement, will find themselves at odds with the Department of Labor and the Internal Revenue Service if they are discovered.

Valuations

I know that you think that I am becoming repetitious but it is imperative that you understand that a valuation is the cornerstone of what we do and provide, even in a start-up.

We continue to insist that any time employer stock is transacted a valuation from a certified, licensed, independent 3rd party valuator must take place. As a matter of fact on August 10th 2010 the IRS Employee Plans Division presented a phone forum on Abusive Tax Avoidance Transactions and Emerging Compliance Issues. The IRS stated that stock in ROBS transactions is currently being exchanged without any real attempt to determine its value.

The stock is said to be equal in value to whatever happens to be available to exchange for it which creates a prohibited transaction. Good luck with that. If you are ever audited questions will arise as to what determined the true value of the purchase. We

eliminate that risk. So I will repeat myself,  “STAY COMPLIANT.”

Valuation Is The Cornerstone

I know that you think that I am becoming repetitious but it is imperative that you understand that a valuation is the cornerstone of what we do and must be provided even in a start-up.

We continue to insist that any time employer stock is transacted a valuation from a certified, licensed, independent 3rd party valuation company must take place. As a matter of fact on August 10th 2010 the IRS Employee Plans Division conducted a phone forum on Abusive Tax Avoidance Transactions and Emerging Compliance Issues addressing specifically this and other issues. The IRS stated that stock in ROBS transactions is currently being exchanged without any real attempt to determine its value. The stock is said to be equal in value to whatever happens to be available to exchange for it which creates a prohibited transaction. Good luck with that.

If you are ever audited questions will arise as to what determined the true value of the purchase. We eliminate that risk. So I will repeat myself  “STAY COMPLIANT”.