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Posted by Gil Faver on January 13, 2007, 1:53 am
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> I'm reviewing a return where an attorney, acting as the
> executor of an estate, used the services of an appraiser to
> value farm land at what appears to be a value substantially
> below fair market value. I have yet to determine if this
> was done intentionally to avoid state taxes but, it is more
> than likely simply due to an error in valuation. The
> numbers are signification ($400K versus $800K). We know
> this because there have been two offers by two different
> sellers for $800K.
>
> My question is this: if it turns out that the valuation was
> simply wrong, can an amendment be done to the estate tax
> return and revaluate the property or is there something
> under Plaut v. Munford, 188 F.2d 543, 545 (2d Cir. 1951)
> where an appraisal for estate tax purposes is "prima facie"
> evidence of the property when the income tax is calculated
> for a subsequent sale. In other words, could I just take a
> position on the tax return as long as I have evidence to
> support the corrected fair market value? FYI, the sale of
> the property did NOT occur within 6 months of close of the
> estate.
would a "proper valuation" result in any increased estate
taxes? If so, don't do it. The capital gains tax with a
$400k basis would be less than an estate tax levy on the
additional $400k valuation.
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