The IRS thinks that the Twins are worth more than the Pohlad estate claimed on Carl Pohlad's estate tax return. (Have they seen the Twins record recently? - ba dum dum)
http://www.startribune.com/business/216303871.html
The estate claimed the value of Carl Pohlad's interest in the Minnesota Twins at the time of his death was $24 million at the time of his death in 2009. The IRS claims it was more like $293 million. So why the discrepancy? Are the Pohlads trying to get away with not paying their fair share? Well, it's not so clear cut.
Valuation of business interests are notoriously difficult to estimate. You can take into account the assets and liabilities of the company, but what about it's liquidity? Are the assets or business interests marketable? These questions create a whole range of good faith valuations on business interests.
This is further complicated when an individual, like Carl in 2009, owned a minority interest. The IRS recognizes that if you own say 10% of the interests in a company worth $100.00, the value of your interest is lower than $10.00 because you can't exert control over the company or its assets and the value should be discounted to reflect the minority status. But, the question of how much the asset is discounted adds another layer of uncertainty.
If you own business interests, its extremely important that you work with legal counsel to determine if you have a taxable estate and how to minimize estate taxes.
And, because I'm a Twins fan, here's my obligatory cheap shot at the Yankees... well, at least the Pohlads are paying estate tax, unlike the Steinbrenners. http://blogs.wsj.com/metropolis/2010/07/13/how-steinbrenner-saved-his-heirs-a-600-million-tax-bill/
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