This paper presents the evolution in Tax Court thinking that has led to the misguided 2014 Estate of Richmond decision.


It then presents the correct economic method to provide a proper answer to the value of built-in gain based on a future exit date.  The question at hand is whether a speculative approach is appropriate.


Because it is based in fact, accrual based valuation has the fairest basis for built-in gain valuation, but the Richmond ruling demands that taxpayers be ready to defend against the Tax Court’s methodology with an economic rebuttal.

How to Defend Built-in Capital Gain Value v. Estate of Richmond (Copyright 2017)