Historically the US Tax Court has, in some of its decisions, ignored the
economic reality of income taxes associated with pass-through entities
(PTEs, i.e., S-corporations, limited liability companies, and partnerships).
Now, the Court has issued a landmark ruling (Estate of Jones v. Commissioner)
recognizing that tax liabilities of PTE owners should be considered when
valuing an ownership interest in PTEs. Further, the court recognized the
value associated with PTE’s ability to avoid dividend taxes. The
approach used by the court is very similar to the Treharne Model developed
by GBV’s Chris Treharne.
This is another example of how Gibraltar Business Valuations provides Better Analysis.
To read the full ruling go to: Resources: Court Cases –
Landmark Valuation Tax Court Ruling