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One part of the business was just purchased for a little over $1,000,000. The purchaser merged their existing business.
I would use the purchase price as FMV. Adding the original business value would be like having an appraisal, based on projection of intangibles about the business.
The owner is relying on the tax/accounting firm to get me #'s, but they only have P&L statements.
If we didn't just make an educated estimate on things applications ask, we'd never get anything done, but this one concerns me, as it's the first time I have encountered that question.
Face value $2,000,000 which also includes an amount which will be a under a collateral assignment for the remaining balance owed to purchase the business, paid out over the terms agreed to. The balance of proceeds to be used to operate the business in the event of owner's death.
I would use the purchase price as FMV. Adding the original business value would be like having an appraisal, based on projection of intangibles about the business.
The owner is relying on the tax/accounting firm to get me #'s, but they only have P&L statements.
If we didn't just make an educated estimate on things applications ask, we'd never get anything done, but this one concerns me, as it's the first time I have encountered that question.
Face value $2,000,000 which also includes an amount which will be a under a collateral assignment for the remaining balance owed to purchase the business, paid out over the terms agreed to. The balance of proceeds to be used to operate the business in the event of owner's death.