Who decides the valuation date in a business valuation dispute?
The proceeding decides, not the appraiser. In a litigated valuation the effective date arrives with the assignment rather than emerging from it: it is set by the statute the matter runs under, by the cause of action pleaded, by the controlling agreement, or by the law of the forum, and the analysis begins after it is settled. The valuation profession's own standards are written on that assumption. American Society of Appraisers Business Valuation Standard BVS-VIII — which by its own preamble “must be followed only in the preparation of comprehensive written business valuation reports developed by all members of the American Society of Appraisers” — requires at IV.F that “The effective date and the report date must be stated,” at IV.B that “If a valuation is being performed pursuant to a particular statute, the statute must be referenced,” and at III.C that the report carry a statement that “a valuation is valid only for the valuation date indicated and for the purpose stated.” Those paragraphs are quoted from the ASA Business Valuation Standards release containing all standards approved through February 2022.
Which date governs is a question of law, and courts say so in those terms. The Tax Court stated the division in one sentence in Estate of Gilford v. Commissioner, 88 T.C. 38 (1987): “While the question of fair market value is a question of fact, the criterion to be applied in determining value is a matter of law,” citing Morris v. Commissioner, 761 F.2d 1195, 1200 (6th Cir. 1985) — and it said so while deciding, as a matter of law, whether a merger that happened after the valuation date could serve as a criterion of value at all. The Nebraska Supreme Court applied the same standard of review to the statutory framework of a closely held buy-out in Bohac v. Benes Service Co., 310 Neb. 722 (2022): “Statutory interpretation is a matter of law, in connection with which an appellate court has an obligation to reach an independent, correct conclusion irrespective of the determination made by the court below.” The layer underneath is not handled on those terms. What the business was worth on the date the law names is found as fact, and even in Bohac, where the buy-out proceeding was reviewed on the record as an equitable action, the court gave weight to the circumstance that the trial court had heard and observed the witnesses.
“The proceeding decides” is not the same proposition as “the statute names a day,” and the distinction is the practical part. Some statutes name the date and leave the court nothing to select: in a New York oppression buy-out the court determines fair value “as of the day prior to the date on which such petition was filed,” and Business Corporation Law §1118(b) offers no alternative. Others hand the date to the judge inside stated limits, which is what Model Business Corporation Act §14.34–derived buy-out provisions do as enacted in Virginia and Nebraska (Va. Code §13.1-749.1(D); Neb. Rev. Stat. §21-2,201(d)), and what several matrimonial statutes do in their own differing ways. Knowing which of the two a matter sits in is worth considerably more before filing than after, because in the first kind the act of filing sets the date and no amount of later modeling reaches back past it. See The valuation date and premise of value.
Can the appraiser or the parties choose the valuation date?
Almost never the appraiser, and the parties only to the extent the governing law lets them ask a court to move it. Where a valuation date can move at all, it moves because a court exercises a discretion the statute conferred, usually on a party's application and inside conditions the statute sets. Two provisions that read almost identically show the range. Under New York Business Corporation Law §1118(b), where an electing purchaser and the petitioner cannot agree, the court may stay the dissolution proceeding and determine fair value “as of the day prior to the date on which such petition was filed, exclusive of any element of value arising from such filing” — and no alternative date appears anywhere in the section. Model Act–derived buy-out provisions carry the same default and then add an escape hatch. Virginia Code §13.1-749.1(D) provides that the court “shall stay the proceedings … and determine the fair value of the petitioner's shares as of the day before the date on which the petition … was filed or as of such other date as the court deems appropriate under the circumstances,” and Nebraska Revised Statute §21-2,201(d) is identical in its operative words.
Even where the discretion exists it is bounded discretion, and the boundaries are conditions rather than guidance. California Family Code §2552(a) requires the court to value the assets and liabilities “as near as practicable to the time of trial,” and §2552(b) permits a different date only “[u]pon 30 days' notice by the moving party to the other party,” only “for good cause shown,” only “at a date after separation and before trial,” and only “to accomplish an equal division of the community estate of the parties in an equitable manner.” Virginia Code §20-107.3 fixes the date of the evidentiary hearing on the evaluation issue and allows another only “[u]pon motion of either party made no less than 21 days before the evidentiary hearing,” and then only “for good cause shown, in order to attain the ends of justice.” California's alternate date lives inside a defined window, and picking a date outside it is error regardless of how well the appraisal resting on it is reasoned.
What a party can do is ask, in the form the statute prescribes and on the schedule it sets. What an appraiser can do is value the business as of whatever date the tribunal has fixed and say so on the face of the report — ASA Business Valuation Standard BVS-VIII IV.F requires the effective date and the report date to be stated, and they are not the same date. An opinion that quietly measures a date other than the one the proceeding fixed is not a methodological disagreement with the other side. It answers a question nobody asked.
Why is the company valued the day before the petition was filed?
Because the statute is keeping the triggering event itself out of the price. New York Business Corporation Law §1118(b) does that job twice in a single clause, having the court determine fair value “as of the day prior to the date on which such petition was filed, exclusive of any element of value arising from such filing but giving effect to any adjustment or surcharge found to be appropriate in the proceeding under section 1104-a of this chapter.” The date keeps the filing out of the measurement, and the exclusion catches whatever the date does not. The election that turns a New York dissolution petition into a valuation proceeding runs on the same clock: under §1118(a) the corporation or another shareholder may elect to purchase the petitioner's shares at fair value “at any time within ninety days after the filing of such petition or at such later time as the court in its discretion may allow.”
Appraisal statutes split on how to achieve the same result. Model Act–derived definitions backdate: Virginia Code §13.1-729 defines fair value as the value of the corporation's shares determined “[i]mmediately before the effectiveness of the corporate action to which the shareholder objects,” so the corporate action cannot move the number, because on the measurement date it has not happened. Delaware does not backdate. Section 262(h) of the Delaware General Corporation Law directs the Court of Chancery to determine “the fair value of the shares exclusive of any element of value arising from the accomplishment or expectation of the merger, consolidation, conversion, transfer, domestication or continuance,” and the Delaware Supreme Court stated the date plainly in Verition Partners Master Fund Ltd. v. Aruba Networks, Inc., 210 A.3d 128 (Del. 2019): “§ 262 requires the Court of Chancery to assess Aruba's fair value as of ‘the effective date of the merger.’” One statute moves the clock back. The other leaves the clock alone and subtracts.
In practice the date is frequently the one variable nobody argues about. In Bohac v. Benes Service Co., 310 Neb. 722 (2022), a buy-out elected in lieu of judicial dissolution, the district court determined the fair value of a 14.84 percent interest “as of September 19, 2018, the day before the petition for dissolution was filed.” The Nebraska Supreme Court affirmed in part, vacated in part and reversed in part, remanding with directions to recalculate fair value. The assignments of error ran to the definition of fair value the district court had used, its application of marketability and minority discounts, the denial of expenses and interest, and the terms of payment. None of them ran to the valuation date. The filing had settled it, and it stayed settled through the appeal.
The date is also not the only thing a filing fixes, and the rest of the calendar is less forgiving than the valuation. Delaware appraisal requires a separate written demand — a proxy or a vote against the deal is not one — delivered to the corporation “before the taking of the vote” where the transaction goes to a stockholder meeting (8 Del. C. §262(d)(1)). Where there is no vote, because approval came by written consent, by short-form merger, or under §251(h), the demand instead runs within 20 days after the corporation's notice or, for a §251(h) merger, “within the later of the consummation of the offer contemplated by § 251(h) of this title and 20 days after the date of giving such notice” (§262(d)(2)); and a petition must be filed in the Court of Chancery “[w]ithin 120 days after the effective date” (§262(e)). Contested public-company merger appraisal — the weight given to deal price, the unaffected trading price, and stripping synergies out of the answer — is covered by our Economic Damages Institute rather than here. This Institute takes appraisal and dissenters' rights in closely held companies; see Appraisal and dissenters' rights.
What is the valuation date for estate and gift tax, and can it be changed?
The time of death for an estate and the date of the gift for a gift, both fixed by statute long before anyone is retained. Internal Revenue Code §2031(a) determines the gross estate by including “the value at the time of his death of all property, real or personal, tangible or intangible, wherever situated,” and Internal Revenue Code §2512(a) provides that “[i]f the gift is made in property, the value thereof at the date of the gift shall be considered the amount of the gift.” Neither date is negotiable, and neither depends on when the return is prepared or when an appraiser is engaged.
The one date a taxpayer can choose is Internal Revenue Code §2032's alternate valuation, and it is the executor's election: §2032(a) permits the value of the gross estate to be determined “if the executor so elects” by valuing the property as the section directs. It is also not simply “six months later.” Property not distributed, sold, exchanged or otherwise disposed of within six months after the decedent's death is valued as of the date six months after death (§2032(a)(2)), while property distributed, sold, exchanged or otherwise disposed of within that period is valued as of the date of that disposition (§2032(a)(1)). A single estate can therefore carry several alternate dates rather than one.
The election is conditioned rather than discretionary, which is what makes Internal Revenue Code §2032 unusual among the date rules. Section 2032(c) permits no election unless it will decrease both “the value of the gross estate” and “the sum of the tax imposed by this chapter and the tax imposed by chapter 13 with respect to property includible in the decedent's gross estate (reduced by credits allowable against such taxes)”; §2032(d)(1) provides that the election is made by the executor on the return and, “once made, shall be irrevocable.” That makes the alternate valuation date the one date in this field selected after the valuation work rather than before it, and the test for selecting it is arithmetic rather than argumentative. Whether to elect in any particular estate is a question for the executor and their tax counsel, not for this Institute. See Estate and gift valuation for the standard of value that applies once the date is fixed.
Who sets the valuation date in a divorce?
The law of the forum, and it is set differently from state to state. There is no national valuation date in marital dissolution and no default worth assuming: the same business, valued by the same appraiser on the same evidence, can carry two defensible numbers depending on which state's statute governs. Four statutes, read in their own text, show the range. Nothing in them states a rule for any other state, and the controlling authority in the forum state should be pulled before any of it is relied on.
California sets a default and a narrow escape hatch. California Family Code §2552(a) requires the court to value the assets and liabilities “as near as practicable to the time of trial,” and §2552(b) permits a different date only upon 30 days' notice by the moving party to the other party, for good cause shown, “at a date after separation and before trial,” and only “to accomplish an equal division of the community estate of the parties in an equitable manner.” Florida splits the question in two inside a single subsection: the cut-off for identifying and classifying marital assets and liabilities is “the earliest of the date the parties enter into a valid separation agreement, such other date as may be expressly established by such agreement, or the date of the filing of a petition for dissolution of marriage,” while the date for determining value is “the date or dates as the judge determines is just and equitable under the circumstances,” and “[d]ifferent assets may be valued as of different dates, as, in the judge's discretion, the circumstances require.” Fla. Stat. §61.075(7).
New York directs the court to choose early, and to choose asset by asset: “As soon as practicable after a matrimonial action has been commenced, the court shall set the date or dates the parties shall use for the valuation of each asset,” and “[t]he valuation date or dates may be anytime from the date of commencement of the action to the date of trial.” N.Y. Dom. Rel. Law §236(B)(4)(b). Virginia carries two different dates inside one section: “The court shall determine the value of any such property as of the date of the evidentiary hearing on the evaluation issue,” subject to a good-cause exception on motion made no less than 21 days before that hearing, while debts are determined “as of the date of the last separation of the parties, if at such time or thereafter at least one of the parties intends that the separation be permanent.” Va. Code §20-107.3.
Two distinctions do the real work in marital dissolution, and collapsing them is a familiar line of cross-examination. The first is classification against valuation: the date that decides whether an asset is in the marital estate is frequently not the date that decides what it is worth, and Florida Statute §61.075(7) legislates both in consecutive sentences. The second is that the standard of value and the valuation date are separate variables set by separate provisions, which Virginia demonstrates within a single state — Virginia Code §13.1-729 defines fair value exhaustively for corporate appraisal, while Virginia Code §20-107.3 names no standard of value at all and sets an entirely different date. See Marital dissolution.
Once the valuation date is fixed, what can the appraiser take into account?
What was known or reasonably knowable on that date. The Tax Court stated the general rule in Estate of Gilford v. Commissioner, 88 T.C. 38 (1987): “In general, property is valued as of the valuation date on the basis of market conditions and facts available on that date without regard to hindsight.” The same opinion states the exception that decides most arguments about later information: “The rule that has developed, and which we accept, is that subsequent events are not considered in fixing fair market value, except to the extent that they were reasonably foreseeable at the date of valuation.” Gilford states that rule for fair market value in a transfer-tax matter; whether and how a known-or-knowable limit applies under a different standard in a different forum is decided by that forum's law.
Later events are not simply inadmissible, and the line between two uses of the same event is where the argument actually happens. Estate of Gilford held that postmortem events can be considered for the “limited purpose” of establishing what the willing buyer and seller's expectations were on the valuation date and whether those expectations were “reasonable and intelligent,” a use the court traced to Estate of Jephson v. Commissioner, 81 T.C. 999 (1983). An event used to show that an expectation held on the valuation date was a reasonable one is doing evidentiary work. The same event used to supply information nobody could have had on that date is doing something else, and it is the first thing an opposing expert will take out of the opinion.
Two disciplines follow from a fixed valuation date, and both are unremarkable until they are missed. A valuation carries its date and its intended use with it: ASA Business Valuation Standard BVS-VIII III.C requires a report to state that “a valuation is valid only for the valuation date indicated and for the purpose stated,” which is why a measurement prepared for a compliance or transactional purpose, as of some other date, is not converted into a litigation valuation by being produced in litigation. And the fixed date should be applied consistently across what is being valued, rather than re-dated for the single asset that moved, except where the forum expressly permits otherwise — as Florida Statute §61.075(7) does by allowing different assets to be valued as of different dates in the judge's discretion.
Using the wrong valuation date is one of the few valuation failures that better modeling cannot repair, because it is a legal error rather than a difference of opinion about method. Where the question is not what an ownership interest was worth on a legally fixed date, but how much a business lost as a result of someone's conduct, that is a damages measure argued against a world that did not happen, and it belongs to our Economic Damages Institute rather than here. Nothing on this page states which date governs any particular matter, or what any interest is worth: counsel chooses the framework and the appraiser opines inside it. See The valuation date and premise of value and Fair value and fair market value. The statutes and decisions cited here were read in primary sources and verified as of 10 September 2026.