Defining the Limits: Navigating Tax Risk with Formula Transfer Clauses

Josh Shilts interviews estate and tax attorney, Bo Trudeau, about formula transfer clauses for estate and gift tax planning. They discuss how these clauses can help reduce tax risk for transfers of hard-to-value assets, review key cases such as Wandry and Procter, and clarify the differences between the various types of formula transfer clauses. The episode highlights the importance of establishing intent, consistent documentation, and timely valuations, and also provides specific strategies to bolster formula transfers against challenges from the IRS. Key takeaways include: Evolution of the case law relating to formula transfersDistinctions between defined value, price adjustment, and other clausesEssential strategies and documentation for formula transfers Continue reading to learn about key resources available at AICPA-CIMA.com to improve your valuation analyses. Guest: Robert H. "Bo" Trudeau, JD, LLM, Purcell, Flanagan, Hay & Greene, P.A. Host: Josh Shilts, CPA/ABV/CFF/CGMA, Forensic & Valuation Services Director, Dean Dorton Please share your thoughts about the episode - click here to leave us a review Want to get involved with future FVS conferences, committees, task forces, or the standing ovation program? Send a message to [e-mail] RESOURCES FOR FURTHER EXPLORATION If you’re using a podcast app that does not hyperlink to the resources, please visit our podcast platform to access the show notes with direct links. Check out early bird and special discounts for AICPA and FVS Section members, and ABV, CFF and CVFI credential holders AICPA Forensic & Valuation Services Conference, Oct 28-30, Aurora, CO, in person and onlineAICPA Expert Witness Skills Workshop, Oct 28-30, Aurora, CO,in person onlyBusiness Valuation School - Sep 8-12, Raleigh NC, in person onlyBusiness Valuation School - Dec 1-5, Live online VS Section 100 Toolkit This toolkit is designed to provide non-authoritative guidance on the development of valuation or calculation engagements in accordance with VS Section 100. Statement on Standards for Valuation Services (“VS Section 100” or “SSVS”), Valuation of a Business, Business Ownership Interest, Security, or Intangible Asset FVS Section Benefit - FVS estate and gift toolkit Stay up to date on the latest FVS estate and gift guidance. This toolkit will serve as an invaluable resource to keep you up to date on the latest guidance. The FVS Valuation Podcast archives Complexities Of Subsequent Events in Business Valuation Enhancing Professional Growth through AICPA FVS Section Resources and Participation Estate Planning – Anticipating the Change in 2025 LEARN MORE ABOUT THE FOLLOWING AICPA CREDENTIALS: Accredited in Business Valuation (ABV®) – Visit the home page and check out the ABV infographic Certified in the Valuation of Financial Instruments (CVFI®) – Visit the home page and check out the CVFI infographic Certified in Financial Forensics (CFF®) - Visit the home page and check out the CFF infographic This is a podcast from AICPA & CIMA, together as the Association of International Certified Professional Accountants. To enjoy more conversations from our global community of accounting and finance professionals, explore our network of free shows here. Your feedback and comments are welcomed at [e-mail]