2032(a) GENERAL. --The value of the gross estate
may be determined, if the executor so elects, by valuing all
the property included in the gross estate as follows:
2032(a)(1) In the case of property
distributed, sold, exchanged, or otherwise disposed of, within
6 months after the decedent's death such property shall be valued
as of the date of distribution, sale, exchange, or other disposition.
2032(a)(2) In the case of property
not distributed, sold, exchanged, or otherwise disposed of,
within 6 months after the decedent's death such property shall
be valued as of the date 6 months after the decedent's death.
2032(a)(3) Any interest or
estate which is affected by mere lapse of time shall be included
at its value as of the time of death (instead of the later date)
with adjustment for any difference in its value as of the later
date not due to mere lapse of time.
2032(b) SPECIAL RULES. --No
deduction under this chapter of any item shall be allowed if
allowance for such item is in effect given by the alternate
valuation provided by this section. Wherever in any other subsection
or section of this chapter reference is made to the value of
property at the time of the decedent's death, such reference
shall be deemed to refer to the value of such property used
in determining the value of the gross estate. In case of an
election made by the executor under this section, then --
2032(b)(1) for purposes of
the charitable deduction under section 2055 or 2106(a)(2), any
bequest, legacy, devise, or transfer enumerated therein, and
2032(b)(2) for the purpose
of the marital deduction under section 2056, any interest in
property passing to the surviving spouse,
shall be valued as of the date of the decedent's
death with adjustment for any difference in value (not due to
mere lapse of time or the occurrence or nonoccurrence of a contingency)
of the property as of the date 6 months after the decedent's
death (substituting, in the case of property distributed by
the executor or trustee, or sold, exchanged, or otherwise disposed
of, during such 6-month period, the date thereof).
2032(c) ELECTION MUST DECREASE GROSS
ESTATE AND ESTATE TAX. --No election may be made under
this section with respect to an estate unless such election
will decrease --
2032(c)(1) the value of the
gross estate, and
2032(c)(2) the sum of the tax
imposed by this chapter and the tax imposed by chapter 13 with
respect to property includible in the decedent's gross estate
(reduced by credits allowable against such taxes).
2032(d) ELECTION. --
2032(d)(1) IN GENERAL. --The
election provided for in this section shall be made by the executor
on the return of the tax imposed by this chapter. Such election,
once made, shall be irrevocable.
2032(d)(2) EXCEPTION. --No
election may be made under this section if such return is filed
more than 1 year after the time prescribed by law (including
extensions) for filing such return.
Presented by Alvin Brown and Associates,
tax attorney, formerly with the Office of the Chief Counsel of the
IRS.
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