Tax Court: Subsequent sale was best evidence of fair market value

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Abstract: This article discusses a case in which the U.S. Tax Court discussed the impact of post–valuation-date sales on fair market value as well as the importance of choosing an experienced, qualified valuation expert. The court found that the sale of a partnership interest, which was agreed to six months after the valuation date and completed nearly four months later, was “probative” of value, but not “conclusive.” The case illustrates the significance of considering subsequent sales in valuing a business interest. Citations: Ringgold Telephone Company v. Commissioner (T.C. Memo 2010-103)