As wine producers and consumers place greater value on the locations where grapes grow, famous areas—such as Napa Valley—have become publicly associated with quality products. Wine producers can potentially quantify these perceptions and significantly offset tax liabilities in the years following a vineyard purchase through an American Viticultural Area (AVA) valuation.
An AVA valuation could allow you to put money spent acquiring land in a desirable AVA back into your businesses—the more prestigious the land you own, the greater your potential savings.
These valuations, however, are a complex process that can attract scrutiny from the IRS and state tax authorities. Presenting well-supported analysis through multiple valuation methodologies is crucial to securing your tax savings.
How Valuations Help Your Business
There’s a distinct separation between your AVA value and the value of your land—AVA value is an intangible asset impacted by several factors, largely the reputation of the region’s grapes.
Our professionals can help you determine the AVA value associated with your vineyard property so you can amortize the AVA intangible asset over time, resulting in potential tax benefits. Using multiple valuation methods, we approach your AVA value from several distinct perspectives—including comparison to competitive regions and an analysis of the royalty rate implied by the AVA value—to recognize the full value of the intangible asset.
Preparing necessary documentation to back up your claims, we’ll help you deliver a defensible valuation for your tax reporting needs.
Our Wine Industry Insight
Our professionals match our deep valuation experience with industry-focused expertise.
With a 30-year history serving clients in the wine industry and a presence in the locations of many AVAs, we understand how to navigate broader industry complexities while customizing solutions to your needs.
Serving 300+ wine, beer & spirits clients, we advise more businesses in the wine industry than any other CPA firm—including 36% of Wine Business Monthly’s Top 50.