Software Valuations

Software can be an extraordinarily valuable asset for many companies. It is a staple for nearly all types of businesses. In fact, it is embedded everywhere! It is in equipment like scanners, milling machines, lathes, sorters, medical equipment, and telephone systems. And that software generally has favorable tax treatment. However, many vendors do not itemize the software’s cost when they sell equipment. Consequently, many companies do not realize this savings opportunity because they cannot quantify the software cost. This issue costs companies millions each year. At P&A, we provide software valuations that can help companies realize this savings opportunity.

Clients also seek our software valuation services to help them facilitate business activity. Common situations for which we value software include the following:

  • Asset sales
  • Asset purchases
  • Capital formation
  • Transfers and estate planning
  • Fair value reporting under SFAS 157
  • Litigation support for copyright infringement damages
  • Fair market value reporting under Revenue Procedure 59-60
  • Compliance with valuation requirements under the Stark Law Anti-Kickback Safe Harbor regulations

We have the proper foundation to defend our software valuations in strict accordance with federal appraisal standards. In fact, we authored the first authoritative paper on how to value embedded software and the first in-depth paper to take a critical eye on the tax treatment of software for state and federal tax reporting purposes.

Find out what we can do for your company. Contact us for more information.