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ASA BVC to Study New 2018 Tax Law

by Jennifer Aguilar | Jan 10, 2018

The Tax Cuts and Jobs Act became effective on January 1, 2018, which may impact the value of various entities and intangible assets. This will necessitate changes in our practice application to value these entities and assets.

The Business Valuation Committee of American Society of Appraisers is studying the new tax law to determine (1) the value impact and (2) changes to applied procedures as necessary. A Tax Reform Task Force (TRTF) has been appointed, chaired by Will Frazier, ASA, to study these issues and present recommended solutions. The task force, comprised of thought leaders within BV, will likely solicit opinions from various valuation scholars and academics. As recommendations are developed, they will be communicated by ASA’s Business Valuation Committee to the valuation profession.

At this juncture, the task force has identified the following topics for study. Many of the topics impacted by the new tax law have complicated rules and exceptions not listed here:
  • C corporation 21% flat tax rate
  • Deductibility of interest – new limits
  • 100% expensing of certain capital expenditures
  • Pass-through income 20% deduction
  • Patents – elimination of capital gain treatment on sale of “self-created” patent
  • Net operating losses – carry forward limited to 80% of income
  • Like-kind exchanges – repeals application to certain business or investment property
If you have identified additional topics you believe are affected by the new tax law, please contact William H. Frazier, ASA at wfrazier@stoutadvisory.com.