American College Exam HS330 Topic 3 Question 104 Discussion

Actual exam question for American College's HS330 exam

Question #: 104
Topic #: 3

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:

AThe agreement requires the payment of liquidated damages to the survivors if the executor fails to carry out its terms.

BThe agreement as to per-share value is fair, adequate, and made at arm's length.

CThe agreement requires a deceased share holder's executor to sell the stock at the price specified in the agreement.

DThe 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.

Show Suggested Answer

Suggested Answer: A

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

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Earnestine

2 days ago

I disagree, I believe the answer is C.

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Tijuana

5 days ago

I think the answer is A.

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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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American College Exam HS330 Topic 3 Question 104 Discussion

Contribute your Thoughts:

Earnestine

Tijuana

Layla