Question 1

What is a gift tax valuation and why do I need it?

Accepted Answer

A gift tax valuation determines the fair market value of assets (like private company stock) that you transfer as a gift to a trust or individual. The IRS requires this valuation to accurately report the value of the gift on Form 709 (Federal Gift Tax Return). It is essential for properly utilizing your lifetime gift tax exemption and establishing the cost basis for the recipient.

Question 2

What are valuation discounts?

Accepted Answer

Valuation discounts are adjustments that can lower the taxable value of the gifted shares. Common discounts include the Discount for Lack of Marketability (DLOM), because private shares are hard to sell, and the Discount for Lack of Control (DLOC), for minority stakes that don't control company decisions. These discounts can significantly reduce the reported value of the gift, allowing you to transfer more wealth tax-free.

Question 3

How does a gift valuation help with QSBS trust stacking?

Accepted Answer

When you transfer stock to a QSBS trust (or multiple trusts for stacking), the value of that transfer must be established to file your gift tax return. A lower, defensible valuation allows you to move more shares into the trust without exceeding your lifetime gift exemption. This maximizes the potential future tax-free gains you can capture under Section 1202.

Question 4

When should I get a gift valuation?

Accepted Answer

You should get a gift valuation contemporaneously with the transfer of assets (i.e., when you fund the trust or make the gift). The valuation date must match the date of the gift. It is best to plan this before your company's value increases significantly (e.g., before a new funding round), so you can transfer more equity at a lower value.

Question 5

How long does the gift valuation process take?

Accepted Answer

Our gift valuation process is thorough yet efficient. Typically, we can deliver a draft report within approximately 1 week after receiving all necessary documentation. This ensures you can meet tax filing deadlines without unnecessary delays.

Gift Valuations.
Defensible. Strategic. Compliant.

Optimized for Tax Strategy

Minimize Gift Tax

Audit-Ready

Transparent Pricing

When to Get a Gift Valuation

Funding a Trust

Gifting to Family

Filing Form 709

Estate Planning

How It Works

Consultation

Analysis

Delivery

Ready to Transfer Your Shares?

Frequently Asked Questions

Gift Valuations.Defensible. Strategic. Compliant.