Attachment “B”

 

Income Determination for the Mehring Family Partnership

Appraised Value of Easement = $ 550,000.00

 

 

                 Adjusted Gross Income By Tax Year

Owner (%)                           1999                      2000                    2001                         Average AGI

Mehring, W. (1%)                $ 86,910                  $ 27,241                  $ 28,580                      $ 47,577

Mehring, W. (33%)              $ 44,372                  $ 70,346                  $ 72,560                      $ 62,426

Mehring, P. (33%)                $ 65,681                  $ 70,327                  $ 64,452                      $ 66,820

Kalton (33%)                         $ 72,258                  $ 61,923                  $ 62,051                      $ 65,411

Weighted Average                                                                                                                  $ 64,714 (88%)

 

 

Owner                                   % Ownership        Ownership Value               AGI           % Appraised Value      Payment

Mehring, Walter & Sara           1.000%                       $    5,500               $ 47,577                             100%                    $     5,500

Mehring, Walter & Paula       33.000%                         181,500                  62,426                               88%                       159,720

Mehring, Peter & Leslie         33.000%                         181,500                  66,820                               88%                       159,720

Kalton, Mike & Margaret       33.000%                         181,500                  65,411                               88%                       159,720

Total                                          100.000%                     $550,000               $ 64,714                                                           $ 484,660

 

 

 

Aggregate Income Approach:                $ 242,234 (4% of appraised value)

Weighted Income Approach:                  $   64,714 (88% of appraised value)

 

 

 

Notes: 

 

1)      The Mehring Family Partnership is comprised of four (4) “husband and wife” partners. 

2)      The calculation of adjusted gross income was based on the joint returns of each couple.

3)      Percent (%) Appraised Value is derived from the income grid (Attachment “A”)

4)      Payment is calculated by multiplying a partners percent of ownership times the appraised value ($550,000).  The resulting value is then multiplied times the applicable “percent of appraised value” based on average adjusted gross income (AGI) from the pervious three years.

 

Example:  If Walter & Paula Mehring together own 33% of the partnership, their relative “ownership value” is $181,500 (33% x $550,000).   Based on their average AGI from the previous 3 years, this “ownership value” must be multiplied times the applicable “Percent of Appraised Value”, as determined by the income grid.  Since the Mehrings AGI falls in the 88% bracket (between $60,001-70,000), they should receive 88% of their ownership value or $159,720 (88% x $181,500).

 

 

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