When selling a business, there are some buyers who would be willing to pay a premium above the fair market value of the business on a controlling basis. These strategic (or synergistic) buyers might include competitors looking to build market share, joint venture partners who already understand the business model or players that are vertically…
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How a Valuation’s Purpose Affects Its Value
What is the value of my business? That’s the question every business owner wonders from time to time. But the correct answer varies depending on the purpose of the appraisal. Different rules and “standards of value” may apply in different circumstances. Fair Market Value In the United States, the most widely recognized and accepted standard of value…
How to Qualify for Tax-Favored Securities Trader Status
It’s advantageous for short-term investors to qualify as traders, rather than investors, for federal income tax purposes. Unfortunately, there’s no bright-line distinction between trader and investor status. Here’s an overview of the IRS and U.S. Tax Court guidance to help determine if you qualify as a tax-favored securities trader. Tax Benefits to Trader StatusFrom a federal income tax…