In this study I explore the relationship between firm value and conforming tax avoidance (tax avoidance that does not create a book-tax difference). Tax avoidance provides firms more cash, creating value for the firm. However, conforming tax avoidance has costs, such as lower book income, and these costs potentially lower firm value. As such, it is unclear whether conforming tax avoidance is correlated positively or negatively with firm value. I use a measure of conforming tax avoidance that was recently introduced in the literature, and I am the first to bifurcate tax avoidance into conforming and nonconforming portions using a large sample. I present evidence that investors place a negative value on conforming tax avoidance for the average firm. I also look at the top quartile based on my measure of conforming tax avoidance and find a positive correlation between firm value and conforming tax avoidance for this subsample. I then explore some potential modifiers of the conforming tax avoidance–firm value relationship and find that the relationship is generally negative for the average firm, but positive for the quartile subsample. I conclude with several robustness tests that explore various configurations of my conforming tax avoidance measure and alternate measures of nonconforming tax avoidance and find similar results as in my main test.