Valuation Techniques and the Federal Gross Estate
Generally, federal estate taxes are based either on the FMV of the transferred property as of the date the decedent died or the alternate valuation date which is six months following the date of death.  

Fair Market Value (FMV):
The price at which property would change hands between a willing seller and buyer of which neither is under any urgency to buy or sell, and both parties have reasonable knowledge of relevant facts pertaining to the property.

Step-up In Basis:
Marketable securities such as publically traded stock, mutual funds, bonds, etc. receive a step-up in basis to FMV at the date of death as well.



Sample Questions 1 - 4

Related Articles
  1. Investing

    How To Value A Real Estate Investment Property

    Make sure you know what your real estate investment is worth before you sign the ownership papers.
  2. Investing

    How To Value A Real Estate Investment Property

    Two common methods for real estate valuation are the discounted net operating income and gross income multiplier approaches.
  3. Financial Advisor

    How Life Insurance Can Help Reduce Estate Taxes

    Inheritance is a double-edged sword, as leaving money can create estate tax burdens. Opting for a life insurance plan can help mitigate those burdens.
  4. Managing Wealth

    Explaining Step-Up In Basis

    A step-up in basis is the increased cost basis of an inherited asset or other security.
  5. Investing

    How To Make Money WIth Real Estate Options

    Buying real estate options is one way to invest in real estate at a lower entry cost.
  6. Investing

    Relative Valuation: Using Stocks To Value Other Stocks

    This effective approach will help you understand which stocks you should be investing in.
  7. Taxes

    Trade Properties To Keep The Taxman At Bay

    Like-kind exchanges can mean a much lower tax bill on real estate for savvy investors.
  8. Investing

    Flipping Houses: Is It Better Than the Buy and Hold Strategy?

    Real estate investors can choose to flip a property or hold it. Find out which strategy may best for you.
Frequently Asked Questions
  1. Depreciation Can Shield Taxes, Bolster Cash Flow

    Depreciation can be used as a tax-deductible expense to reduce tax costs, bolstering cash flow
  2. What schools did Warren Buffett attend on his way to getting his science and economics degrees?

    Learn how Warren Buffett became so successful through his attendance at multiple prestigious schools and his real-world experiences.
  3. How many attempts at each CFA exam is a candidate permitted?

    The CFA Institute allows an individual an unlimited amount of attempts at each examination.Although you can attempt the examination ...
  4. What's the average salary of a market research analyst?

    Learn about average stock market analyst salaries in the U.S. and different factors that affect salaries and overall levels ...
Trading Center