With the acquisition of Acuity Advisors, we have a team dedicated to ESOP formation and consultation. Our ESOP valuation experts provide an integrated array of services through the various stages of ESOP planning, execution, and administration, including:
Adequate Consideration Opinions
Initial ESOP formation valuations
Annual enterprise and equity valuations, valuation review and consulting
Shareholder and ERISA dispute resolution and litigation support
Valuations of businesses, divisions, equipment, and real estate for financing purposes
Our ESOP valuations are compliant with our understanding of standards set by the US Department of Labor (DOL), the US Internal Revenue Service, the Uniform Standard of Professional Appraisal Practices (USPAP), and the American Society of Appraisers (ASA) as well as the best practices outlined in the 2014 DOL Settlement Agreement with GreatBanc Trust Co., often referred to as “Paragraph D.”
For an understanding of concerns over the valuation of ESOPs, please see the following DOL caselaw:
First Bankers Trust Services and Sonnax (2016)
First Bankers Trust Services and SJP Group (2017)
First Bankers Trust Services and Marian (2107)
Constellis ESOP v. Wilmington Trust (2017)
Our ESOP experience includes valuation of companies in a broad range of industries and size of business.
We employ our knowledge of the appropriate regulatory guidance to provide the complete scope of work and report expected by ESOP trustees, counsel, audit firms, and regulators.
For more information about ESOP or other valuation services, contact one of our expert professionals.
Our ESOP Valuation team collaborates with our internal multi-disciplinary professionals to provide the value analyses and fresh independent opinions to fiduciaries, financing sources and investors for public and private company transactions.
Marshall & Stevens has a large team of valuation professionals, all of which have industries where they have a particular expertise, including: agriculture, automotive, chemical, construction and engineering, consumer products, energy and infrastructure, entertainment and media, food and beverage, healthcare, hospitality and gaming, manufacturing and distribution, real estate, professional services, technology.
The IRS expects that gifts of equity in a business or operating asset (i.e. real estate) be performed by a “qualified appraiser” as defined by the IRS.
Reporting a value to the IRS that is below the IRS’ opinion of fair market value may lead to additional taxes and penalties on the transaction.
A fractional interest in a business is not typically equal to the respective percentage in the total value. Matters of control in the business and marketability of the equity often leads to a material discount from the pro rata value.
Marshall & Stevens performs real estate appraisals for financing, estate and gift tax planning and reporting, buy/sell consideration, insurance, easements, property tax, and litigation.
The accelerated depreciation benefits from a cost segregation analysis on acquired real estate (or improvements for leased space) can typically pay for a material percentage of the transaction costs and/or multiple financing payments.
Marshall & Stevens provides Fairness and Solvency Opinions, valuation analyses, investigative accounting, and expert witness services to assist public and private clients with their important transactions and litigation matters.
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