Gift, Estate, & Income Tax Compliance

January 1, 2018

Mercer Capital’s Value Matters® 2018-01

Six Different Ways to Look at a Business

Along the road to building the value of a business it is necessary, and indeed, appropriate, to examine at the business in a variety of ways. Each provides unique perspective and insight into how a business owner is proceeding along the path to grow the value of the business and on if/when it may be ready to sell.  Most business owners realize the obvious events that may require a formal valuation:  potential sale/acquisition, shareholder dispute, death of a shareholder, gift/estate tax transfer of ownership, etc.  A formal business valuation can also be very useful to a business owner when examining internal operations.  

So, how does a business owner evaluate their business? And how can advisers or formal business valuations assist owners examining their businesses? There are at least six ways and they are important, regardless of the size of the business.  All six of these should be contemplated within a formal business valuation.  

  1. At a point in time. The balance sheet and the current period (month or quarter) provide one reference point. If that is the only reference point, however, one never has any real perspective on what is happening to the business.
  2. Relative to itself over time. Businesses exhibit trends in performance that can only be discerned and understood if examined over a period of time, often years.
  3. Relative to peer groups. Many industries have associations or consulting groups that publish industry statistics. These statistics provide a basis for comparing performance relative to companies like the subject company.
  4. Relative to budget or plan. Every company of any size should have a budget for the current year. The act of creating a budget forces management to make commitments about expected performance in light of a company’s position at the beginning of a year and its outlook in the context of its local economy, industry and/or the national economy. Setting a budget creates a commitment to achieve, which is critical to achievement. Most financial performance packages compare actual to budget for the current year.
  5. Relative to your unique potential. Every company has prospects for “potential performance” if things go right and if management performs. If a company has grown at 5% per year in sales and earnings for the last five years, that sounds good on its face. But what if the industry niche has been growing at 10% during that period?

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October 2026 | When a Large Ownership Block Doesn’t Mean Control
Value Matters® October 2026

When a Large Ownership Block Doesn’t Mean Control | Valuation Lessons from Grieve v. Commissioner

A large ownership interest does not necessarily convey control, a distinction with important implications for gift and estate tax valuations. In Grieve v. Commissioner, T.C. Memo. 2020-28, the U.S. Tax Court accepted discounts for lack of control and lack of marketability on ownership interests representing 99.8% of the economic interests in two family-owned LLCs.
Thomas C. Insalaco to Speak at Tampa Bay Estate Planning Council
Thomas C. Insalaco to Speak at Tampa Bay Estate Planning Council
Thomas C. Insalaco, CFA, ASA, Senior Vice President at Mercer Capital, will speak at the Tampa Bay Estate Planning Council on Wednesday, October 21, 2026, at the Chester H. Ferguson Law Center in Tampa, Florida.His presentation, “Navigating Business Valuations: What Estate Planners Need to Know,” will examine common estate planning valuation issues that have recently received IRS scrutiny and offer practical guidance for avoiding potential problems.The Tampa Bay Estate Planning Council brings together attorneys, fiduciaries, accountants, investment advisors, charitable giving specialists, family office executives, insurance professionals, and valuation experts. The Council promotes collaboration among the disciplines involved in estate planning and provides educational opportunities for its members. As a Council Partner, Mercer Capital is proud to support the organization’s educational programming and commitment to collaborative planning.Tom Insalaco is a Senior Vice President and a member of Mercer Capital’s Gift, Estate, and Income Tax Planning and Compliance practice group. Since 2008, he has provided valuation services across a broad range of industries and matters, including gift and estate tax, business succession and exit planning, and buy-sell agreements.Mercer Capital regularly works with attorneys, fiduciaries, business owners, and other professional advisors on valuation matters involving gift and estate tax planning, business succession, ownership transitions, and buy-sell agreements.For additional information or to register, visit the Tampa Bay Estate Planning Council’s website.
Mercer Capital to Sponsor ACTEC’s 2026 Fall Meeting
Mercer Capital to Sponsor ACTEC’s 2026 Fall Meeting
Mercer Capital is pleased to sponsor the American College of Trust and Estate Counsel’s 2026 Fall Meeting, taking place October 15 through 18, 2026, at the Hyatt Regency Denver in Denver, Colorado. Bryce Erickson, ASA, MRICS, J. David Smith, CFA, ASA, and Sujan Rajbhandary, CFA, ABV, will attend on behalf of the firm.ACTEC’s national meetings bring together leading trust and estate lawyers, law professors, and other professionals for education, committee sessions, and peer discussion. This year’s professional program will address the prudent investment of unique and unusual assets; estate and business planning for farms, ranches, and oil and gas interests; publicity rights; digital assets; art collections; and assets held in regulated businesses.Bryce Erickson, ASA, MRICS, is a Managing Director and member of Mercer Capital’s board of directors. Since 1998, he has led approximately one thousand valuation engagements and has deep experience in gift, estate, and federal tax matters, litigation support, transactions, and business planning across a broad range of industries. Bryce leads Mercer Capital’s energy industry practice and is a regular contributor to Mercer Capital’s Energy Valuations Insights blog.J. David Smith, CFA, ASA, is a Senior Vice President at Mercer Capital and a senior member of the firm’s tax practice. He provides valuation services for tax planning, transactional purposes, and financial reporting, with particular experience in industries including financial services, oil and gas, and biotechnology. David is also a regular contributor to Mercer Capital’s Value Matters Newsletter.Sujan Rajbhandary, CFA, ABV, is a Senior Vice President and a member of Mercer Capital’s Gift, Estate & Income Tax Valuation Group. During his 20-year career at Mercer Capital, he has provided valuation and financial advisory services for tax planning and compliance, transactions, ownership transitions, and other corporate and shareholder matters. He is a regular contributor to Mercer Capital’s Value Matters Newsletter.Mercer Capital regularly works with attorneys, fiduciaries, business owners, and professional advisors on valuation matters involving gift and estate tax planning, trusts, ownership transitions, transactions, and disputes. The firm is proud to support ACTEC’s commitment to professional education and excellence in trust and estate law.Mercer Capital looks forward to reconnecting with friends and meeting new colleagues in Denver. For more information about the 2026 Fall Meeting, visit ACTEC’s event website.

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