American College Exam HS330 Topic 1 Question 68 Discussion

Actual exam question for American College's HS330 exam

Question #: 68
Topic #: 1

Which of the following statements concerning the valuation of intangible personal property in the gross estate of a decedent is correct?

AIf there were no trades of a listed common stock on the date of the stockholder's death, the stock's value is based on its average daily price for the previous month prior to the shareholder's death.

BCertain U.S. Treasury bonds that are used to pay federal estate taxes at par are valued at their market price on the date of death of the owner.

CWhen a minority stockholder in a closely held corporation dies, his stock is valued on the basis of the ''blockage'' rule.

DValuing closely held stock requires the consideration of several factors outlined by IRS rulings.

Show Suggested Answer

Suggested Answer: D

by Denise at Mar 30, 2023, 11:56 PM

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Bok

4 days ago

But what about option A? It seems reasonable to use the average daily price for the previous month.

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Makeda

5 days ago

D is the correct answer. The valuation of closely held stock requires the consideration of several factors outlined by IRS rulings, such as the company's financial condition, earning capacity, and market for the stock.

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Elke

8 days ago

I agree with Rocco, because IRS rulings provide guidance on valuing closely held stock.

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Rocco

10 days ago

I think the correct statement is D.

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