Term
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Definition
| The date 6 months after the decedent's death that may be used for estate tax valuation purposes. |
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Term
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Definition
| The value at which estate assets are included in the gross estate for federal estate tax purposes; the price at which property would change hands between a willing buyer and a willing seller, neither being under a compulsion to buy or to sell and both having knowledge of the relevant facts. |
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Term
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Definition
| Election available to value certain real property by taking into consideration how the property currently is utilized instead of how it might be used if placed in its best and most profitable use. |
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Term
| Farm-Method Formula of Valuation |
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Definition
| A special (or limited) use valuation of land used for farming purposes, calculated by dividing the excess of the average annual gross cash rental for comparable farm property over the average annual state and local real estate taxes for such comparable property, by the average annual effective interest rate for all new Federal Land Bank loans. |
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Term
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Definition
| For tax benefit purposes, a provision that reclaims the tax benefits derived from certain favorable-tax-treatment Code sections if and when specific qualification requirements of the particular Code section are violated. |
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Term
| Willing Buyer-Willing Seller Rule |
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Definition
| A standard for valuation of property - the price at which a willing buyer would buy and willing seller would sell, neither being under any compulsion to do so, and both being informed of the material facts surrounding the transaction. |
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Term
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Definition
| The economic advantage or benefit that is acquired by a business beyond the mere value of the capital invested in it because of the patronage it receives from constant or habitual customers, its local position, its reputation for skill or punctuality, other accidental circumstances or necessities, or public partialities or prejudices. |
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Term
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Definition
| The worth of a business interest's assets minus the cost of its liabilities. |
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Term
| Adjusted-Book-Value Method |
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Definition
| A valuation method in which the value of closely held corporation assets is adjusted to reflect the difference between true market value and book value. |
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Term
| Capitalization-of-Adjusted-Earnings Method |
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Definition
| A valuation method in which the value of closely hold corporation is determined by multiplying the adjusted earnings of the business by a factor appropriate for the specific industry at the predetermined valuation date. |
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Term
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Definition
| A method to control future appreciation in the value of assets in order to reduce prospective estate taxes. |
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