Chuck Fleischmann for Congress named Tom Decosimo, Managing Principal at DCF, the campaign's finance chairman today.

According to Mr. Decosimo, “Chuck’s business experience, intellectual depth, ethical, moral, and conservative grounding, and exceptional work ethic combine to make Chuck a very effective voice for the 3rd district. His command of the complex issues facing our nation and our region has earned him the respect of his colleagues and Congressional leadership. Most importantly, Chuck's understanding of the issues has earned him the trust of the citizens that he has faithfully represented. I am honored to serve Chuck Fleischmann for Congress, and I feel a deep sense of civic duty to help return Chuck to Congress.”

Congressman Fleischmann stated, “I am very thankful to have Tom’s support and help as the 2012 election draws closer. Tom has been a fixture of the Chattanooga area and is well-respected throughout the business community. I have relied on Tom’s advice in many areas during my service in Congress. I am pleased that he has examined my ...

Many of our clients struggle with the question of how to compensate and appropriately incentivize key employees. One solution relied on by the compensation committees of many public companies is to grant equity securities, such as shares of stock or stock options, to key employees. This strategy aligns the economic interests of owners and managers, because the employees benefit from an increase in the value of the underlying enterprise.

While the granting of equity securities to incentivize managers is a practical solution in a publicly traded company, the vast majority of businesses are not publicly traded. The nonmarketable minority interests of privately held businesses present a number of complications when used as incentive securities. For example, options of a Subchapter S corporation may be treated by the IRS as a second class of stock, causing the S election to be lost. Further, securities of any pass-through entity (such as an S corporation, partnership, or LLC) issued to incentivize employees may complicate the tax situation of both the employee and the employer.

For these and other ...

DCF Managing Principal, Tom Decosimo, recently testified in United States Tax Court in Washington, DC as an expert in corporate valuation. His testimony addressed a number of issues, including reviews of the work of other appraisers, whether a discount for lack of marketability was appropriate in the case, and the extent of the discount, if one applied. Tom led a team of professionals at Decosimo Advisory Services (DAS, a division of Joseph Decosimo and Company, PLLC) in this engagement that included DCF Director Brent McDade. The complex dispute called upon the expertise and experience of DCF in corporate valuation, derivative security valuation, and investment banking.

The Tax Court is considered a prestigious venue in which to testify as an expert witness in corporate valuation, because its judges have particular expertise in the fields of taxation, economics, and finance. DCF is proud that its professionals, exemplified in this instance by Tom Decosimo and Brent McDade, are receiving national recognition of their abilities.

Our client took over his family’s manufacturing business in 2001. Several days before Christmas 2005, his phone rang in the middle of the night—his company was on fire. He arrived at the scene at the same time as the firefighters, and he watched the family business go up in smoke. He vowed if he ever got his company running again, that he would never have all of his eggs in one basket.

A year later, the company was back in production, and our client was confident it was going to survive. He acted on the promise he had made to himself and called us to discuss how to begin planning for a business transition.

In our initial meeting, we discussed his goals with regard to when he would transition his company, the types of investors who were likely to be interested, the deal proceeds he hoped to receive, and, most importantly, the process of preparing the business for a transition. At the time, the owner wanted to sell his company in five years ...

Estate taxes are complicated, but generally, once the value of an estate exceeds $5 million, an individual can count on paying an approximate 50% federal and state estate tax rate (no wonder some people call them death taxes). One of the key benefits of strategic transition planning is a reduction in the total taxes that must be paid to transfer the proceeds from a sale of a business to the next generation.

Estate taxes are calculated based on the fair market value of the assets in the estate at the time of death. Similarly, gift taxes are based on the fair market value of the gifted assets at the time of the gift. Appraisers recognize three levels of value based on the degree of control and marketability associated with the interest. The fair market value of the business as a whole when sold outright is calculated at the controlling interest level of value. The fair market value on a controlling interest basis includes the benefit of the ability to control the operating, financial, and strategic ...