IRS Logo
Print - Click this link to Print this page

Valuation of Assets - Private Foundation Minimum Investment Return: Reduction in Value for Blockage or Similar Factors

In determining the value of securities, a private foundation may establish that the price at which the securities could be sold outside the usual market may be a more accurate indication of value than market quotations, as a result of--

  • the size of the block of securities,
  • the fact that the securities are in a closely held corporation, or
  • the fact that the sale of the securities would result in a forced or distress sale.

In such a case, any reduction in value for all of these reasons together may not be more than 10 percent of the fair market value of the securities to which the discount applies.

Page Last Reviewed or Updated: 31-Aug-2016