New IRS Proposed Regulations Seek to Curtail Entity Valuation Discounts for Estate, Gift, and GST Tax Purposes

Recently the IRS released proposed regulations under Chapter 14 of the Internal Revenue Code that would severely limit—if not eliminate—the application of valuation discounts, including lack of marketability and minority discounts, to interests in closely held family entities for gift, estate, and generation-skipping transfer tax purposes. If finalized in their current form, the proposed regulations will have a significant impact on future estate planning for high net worth individuals and, potentially, on estate plans which were recently put into place.