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American College Exam HS330 Topic 3 Question 104 Discussion

Actual exam question for American College's HS330 exam
Question #: 104
Topic #: 3
[All HS330 Questions]

Generally the courts will accept as the federal estate tax value of a closely held corporate business the price established by a buy-sell agreement if all the following conditions are met EXCEPT:

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Suggested Answer: A

by Galen at Dec 05, 2024, 10:23 AM

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Lizbeth
1 months ago
As an accountant, I'm going to have to go with B. Fair and arm's length agreements are key, otherwise the courts won't respect the valuation.
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Art
14 days ago
Offering the stock to the corporation or other shareholders first is a good way to maintain control over ownership transfers.
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Nicholle
21 days ago
Selling the stock at the price specified in the agreement seems like a reasonable condition to meet.
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Leonora
24 days ago
Liquidated damages to survivors could complicate things if the executor fails to carry out the terms.
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Cassandra
1 months ago
I agree, fair and arm's length agreements are crucial for the courts to accept the valuation.
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Gilma
1 months ago
Haha, this question is like a game of 'What NOT to Do' when it comes to buy-sell agreements. I'd say A is the answer, who wants to pay liquidated damages for not following an agreement?
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Mendy
2 months ago
The correct answer is C. The agreement can't require the executor to sell the stock at the specified price. That takes away too much control from the estate.
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Darrin
15 days ago
D) The agreement requires a shareholder to first offer his stock to the corporation or other shareholders at the specified price if he wishes to sell it during his lifetime.
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Gregoria
17 days ago
B) The agreement as to per-share value is fair, adequate, and made at arm's length.
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Twila
24 days ago
A) The agreement requires the payment of liquidated damages to the survivors if the executor fails to carry out its terms.
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Onita
2 months ago
Hmm, this is a tricky one. I'm going to go with B. The agreement needs to be fair and at arm's length, so that's the exception that stands out to me.
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Aleisha
22 days ago
User 3: I'm going with D. Offering stock to the corporation first is crucial.
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Nobuko
25 days ago
User 2: I disagree, I think it's C. Selling at the specified price is key.
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Rosamond
1 months ago
User 1: I think it's A. Liquidated damages seem important.
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Earnestine
2 months ago
Hmm, you might be right. Let's review the conditions again.
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Tijuana
2 months ago
But doesn't the agreement requiring the payment of liquidated damages to survivors seem like an exception?
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Earnestine
2 months ago
I disagree, I believe the answer is C.
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Tijuana
2 months ago
I think the answer is A.
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Layla
2 months ago
I think the answer is D. The agreement should not require a shareholder to offer the stock to the corporation or other shareholders at the specified price during their lifetime. That's too restrictive.
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Olen
1 months ago
D) The agreement requires a shareholder to first offer his stock to the corporation or other shareholders at the specified price if he wishes to sell it during his lifetime.
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Ahmed
1 months ago
C) The agreement requires a deceased share holder's executor to sell the stock at the price specified in the agreement.
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Alline
2 months ago
B) The agreement as to per-share value is fair, adequate, and made at arm's length.
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Sue
2 months ago
A) The agreement requires the payment of liquidated damages to the survivors if the executor fails to carry out its terms.
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