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Chapter 14 Valuation Rules (Section 2701-2704) | The IRS enacted IRC Chapter 14, IRC Secs. 2701-2704, to abolish perceived valuation abuses in family asset transfer transactions. The overall rationale of IRC Chapter 14 is that the valuation of any partnership interests or shares of privately-held stock transferred to family members should ignore any provisions in partnership or shareholder agreements that would not be acceptable in unrelated third party, or arm's length, transactions. As a general rule, the safest approach to prevent IRC Chapter 14 compliance issues is to avoid any partnership provisions that would not be acceptable in a commercial transaction between unrelated parties acting in their own self-interest.