Abstract
ABSTRACT Financial and accounting professionals, the IRS, and the legal community continually deliberate the value of a business based on its legal structure—most often comparing the value of a C-Corporation to pass-through entities such as S-Corporations and limited liability companies. Despite the continued deliberations and various court rulings, the cleavages of thought have not converged on a single hypothesis of value. We provide an empirical analysis on M&A transaction data that spans nearly two decades. Specifically, we conduct multiple ANOVA tests, and a programmatic matching analysis of nearly identical pass-through entities and C-Corporation transactions that occurred in the same industry. The results validate the premise that there exists no pass-through entity valuation premium. JEL Classifications: C60; G12; G32; G34; H29; K22.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
