Which of the following is a correct statement regarding a redemption to pay death taxes (“Estate...
Which of the following is a correct statement regarding a redemption to pay death taxes (“Estate taxes”) under § 303?
a. An estate recognizes gain on the redemption equal to the excess of the distribution proceeds over the decedent’s basis in the stock.
b. The § 318 stock attribution rules do not apply to the redemption.
c. The value of the stock in the decedent’s gross estate must exceed 40% of the value of the adjusted gross estate.
d. A corporation recognizes gains and losses on the distribution of property in the redemption.
Homework Answers
b. The § 318 stock attribution rules do not apply to the redemption
The surviving family members can sell their stock to corporation under section 303.
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