Jasper died in 2021. His adjusted gross estate was $13,000,000. Included in his adjusted gross estate was the stock of JCT Corp. stock with a FMV of $5,200,000. Jasper had acquired the stock ten years ago and his basis in the stock was $1,700,000. In order to obtain cash to pay estate taxes and final expenses, Jasper's estate redeems one-half of the JCT stock for $2,600,000.
a. Does Jasper's estate qualify for the Sec. 303 redemption? Explain.
b. What are the tax consequences of the redemption?

Answer rating: 100% (QA)

A In order to settle estate taxes and other last expenses the decedents heirs may redeem their share... View the full answer