Reasonable Compensation Opinion Letters & Studies
Documented, Defensible Compensation Opinions — Before There Is a Dispute
An independent written opinion on owner and executive pay, built on market data and prepared to the same standard as our litigation work — because the best audit defense is contemporaneous documentation.
What an Opinion Letter Does
A Grahall opinion letter or compensation study establishes a supportable range for an owner-executive’s pay, documents the data and methodology behind it, and puts a dated, independent analysis in the file at the moment the compensation decision is made. If the figure is ever challenged — by the IRS, a shareholder, a spouse’s counsel, or an opposing valuation expert — the documentation already exists, prepared by consultants who testify on these questions.
When an Independent Opinion Earns Its Keep
S Corp & C Corp Owners
Document shareholder-employee compensation when it is determined. A study can support the factual analysis in S-corporation employment-tax wage-characterization matters and in compensation-deduction disputes under IRC §162(a)(1).
Nonprofit Executives
For applicable tax-exempt organizations, a study can provide comparability evidence for the §4958 rebuttable-presumption process. The process generally requires advance approval by an authorized, conflict-free body, reliance on appropriate comparability data, and adequate, timely documentation. Commissioning a study alone does not create the presumption.
Valuation Normalization
An independent normalized-compensation figure for business valuations — marital dissolution, buy-sell events, estate and gift — where owner pay drives enterprise value.
Transactions & §280G
Compensation reasonableness support in change-in-control planning and disputes over parachute payments and executive arrangements.
Letter or Full Study — What You Receive
The Opinion Letter
A concise, signed opinion stating the supportable compensation range and its basis — suited to planning files, board minutes, and audit response.
Data sources identified. Methodology stated. Assumptions disclosed.
Delivered on a defined timeline at a fixed fee for most engagements.
The Full Study
A complete compensation analysis: role decomposition (“Many Hats”), market comparability against credible third-party survey data, and — where relevant — the independent investor test.
A full study can provide a documented foundation for later litigation work. Later litigation may require additional analysis or an updated report. Any expert report or testimony must meet the governing disclosure rules, court orders, and evidentiary requirements.
This material is general educational information, not legal or tax advice for a particular matter. Requirements vary by jurisdiction and can change. Counsel and tax advisers should verify the governing rules. No tax treatment, privilege, admissibility or case outcome is guaranteed. An inquiry does not create an engagement.
How an Engagement Works
1. Conflicts Check
Send the party names — nothing confidential. We confirm we are clear to engage, typically within one business day.
2. Scope & Engagement
A short call on the issues, timeline, and role, confirmed in an engagement letter with a defined fee structure.
3. Analysis & Report
We gather the record, apply the documented methodology, and deliver a report or opinion built to withstand scrutiny.
4. Support & Testimony
From audit conferences to deposition and trial — your expert defends the opinion wherever the matter goes.
Document the Decision Before It's Questioned
Call 917-453-4341 or 603-205-5033, or start with a conflicts check — party names only, nothing confidential.