Authored by: Dana L. Mark In 1990 Chapter 14 (Special Valuation Rules) was added to the Internal Revenue Code to prevent the manipulation of the transfer tax value of a proprietary interest in certain entities in the context of transfers between related parties. In other words, what discounts ought to be taken into account in valuing the transferred interest if control of the entity remains within the family. Included among the new rules was Section 2704 dealing with the treatment of certain lapsing rights and restrictions. Essentially, in the context of a family held entity, if the interest in the… Read more