What is Estate tax installment payments?
In short
If a closely held business interest makes up more than 35% of the adjusted gross estate, the estate tax on that interest can be paid in installments: interest only for up to 4 years, then up to 10 annual payments.
Key takeaways
- A reduced 2% interest rate applies to part of the deferred tax.
- Selling or withdrawing a large part of the business can speed up the payments.
- It helps avoid forced sales of the business to pay estate tax.
Where it's tested
TCP: Estate & Gift Tax Planning — study notes, a five-minute revision sheet and practice questions.
Practise: 3 questions
Question 1 of 3 · 0 answered
Valuation discounts for a minority interest in a closely held business reflect: