by Boyd Johnson on March 10, 2009
Obtaining date of death values of publicly traded stocks for probate and tax purposes can be laborious.
The proper valuation method is to average the high and the low selling price on the date of death. If the decedent died on a weekend or a day the markets weren’t open, you obtain the high-low average for the previous trading day and the following trading day and average them.
For decedent’s who owned a number of stocks, the work involved can be extensive and time-consuming. Added to the burden is the need to account for dividends, stock splits, and mergers.
By far, the best resource to help you get the right values quickly and easily is EVP Office’s EstateVal. The software is free to download and costs about $1.55 per security entered. This program is the same one the IRS uses to verify stock prices on 706’s. To calculate date of death values, all you have to do is enter the CUSIP number for the security and the number of shares. It does the rest, including automatically accounting for dividends and stock-splits. It can also handle certain types of savings bonds.
If you don’t know the CUSIP number for a given security, visit the company’s website, contact a broker, or find it by visiting this Fidelity Investments page.
Categorized in Practice Tips and tagged as estate tax, inventory, probate, savings bonds, stocks, valuation
by Boyd Johnson on December 24, 2008
In follow-up to yesterday’s post, sometimes you don’t want “the public” (i.e. speculators and busy-bodies) to know the exact value of real estate or other assets in the probate. Here’s a couple of ways to keep the values private:
- The initial Petition or Application to open the probate merely requires estimated values to be given. Typically, you haven’t yet appraised property at this point. The point of listing the estimated values of the probate and non-probate assets is so that the probate court can determine whether the estate is insolvent or not. An acceptable estimate could be something like “$100,000+” for a value. The figure you provide should be balanced with the requisite duties of candor to the court.
- While the Inventory requires exact values at the time of death (estimates will not do), the Inventory may not need to be filed. There are a variety of factors that determine whether the Inventory must be/should be filed (e.g. local practice, the type of proceeding, the identity of the interested parties, etc.) Note the important word “or” in 524.3-706 (“a personal representative…shall prepare and file or mail an inventory…) This statute provides at least the possibility that you do not need to file the Inventory. But again, other factors should be weighed.
The information above does not constitute legal advice. Please see our disclaimer.
Categorized in Practice Tips and tagged as application, asset values, inventory, petition, probate