U.S. Code » Title 26 » Subtitle B— Estate and Gift Taxes › CHAPTER 14— SPECIAL VALUATION RULES

26 U.S.C. § 2703

Certain rights and restrictions disregarded

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(a) General ruleFor purposes of this subtitle, the value of any property shall be determined without regard to—(1) any option, agreement, or other right to acquire or use the property at a price less than the fair market value of the property (without regard to such option, agreement, or right), or(2) any restriction on the right to sell or use such property.(b) ExceptionsSubsection (a) shall not apply to any option, agreement, right, or restriction which meets each of the following requirements:(1) It is a bona fide business arrangement.(2) It is not a device to transfer such property to members of the decedent’s family for less than full and adequate consideration in money or money’s worth.(3) Its terms are comparable to similar arrangements entered into by persons in an arms’ length transaction.(Added Pub. L. 101–508, title XI, § 11602(a), Nov. 5, 1990, 104 Stat. 1388–498.)
Notes of Decisions
Cited in 14 cases (4 in the last 5 years), 1933–2024 · leading case: Est. of Smith v. United States, 103 Fed. Cl. 533 (Fed. Cl. 2012).
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Est. of Smith v. United States, 103 Fed. Cl. 533 (Fed. Cl. 2012). · cites it 7× “Plaintiffs also raise 26 U.S.C. § 2703 on the valuation issue, which states: (a) General rule.”
Comm'r v. Beebe, 67 F.2d 662 (1st Cir. 1933). · cites it 2× “In passing, however, it may be said that such a construction of section 23 (c) of the Revenue Act of 1928 is so contrary to sound reason and the general policy as to deductions indicated in section 23 (26 USCA § 2023) as a whole, that I think it should be construed as merely…”
Reams v. Vrooman-Fehn Printing Co., 140 F.2d 237 (6th Cir. 1944). “The Internal Revenue Code, 26 U.S.C.A. § 2703 (a), provides for the refundment of all erroneous payments of taxes, interest or penalties.”
Est. of Robert E. Cartwright, Deceased, Dorothy G. Cartwright v. Comm'r of Internal Revenue, 183 F.3d 1034 (9th Cir. 1999). “See 26 U.S.C. § 2703 (b). That is precisely what was done in this case.”
Martz v. Comm'r, 82 F.2d 110 (9th Cir. 1936). “(2d) 6 , at page 7): “It is argued that section 23 (c) (3) does not apply to the present case because, under section 703 (a) (2) of the same Revenue Act of 1928 ( 26 U.S.C.A. § 2703 (a) (2), inheritance taxes were to be allowed as a deduction to the beneficiary, if claimed by…”
Connelly v. United States, 602 U.S. 257 (2024). “See 26 U. S. C. § 2703 . As a general rule, the fair market value of the corporation determines the value of the shares, and one must therefore consider “the company's net worth, prospective earning power and dividend-paying ca- pacity, and other relevant factors,” “including…”
Connelly v. United States, 602 U.S. 257 (2024). “See 26 U. S. C. §2703 . As a general rule, the fair market value of the corporation determines the value of the shares, and one must therefore consider “the com- pany’s net worth, prospective earning power and dividend- —————— threshold (today, about $13.”
Connelly v. United States, No. 4:19-cv-01410 (E.D. Mo. Sept. 21, 2021). · cites it 9× “Under 26 U.S.C. § 2703 (a), the IRS generally determines the fair market value of any property without regard to a buy-sell agreement, but certain kinds of buy-sell agreements fall under an exception to this general rule.”
Jackson v. Price, 74 F.2d 707 (2d Cir. 1985). · cites it 2× “'791, 879, 26 USCA § 2703) are considered, it is clear that the income paid over to the appellee is subject to a tax.”
Parrott Est. Co. v. McLaughlin, 12 F. Supp. 23 (N.D. Cal. 1935). “791) section 703 (a) (2, 3) of which, 26 USCA § 2703 (a) (2, 3), is as follows: “Sec.”
Thomas Connelly v. United States, 70 F.4th 412 (8th Cir. 2023). “” 26 U.S.C. § 2703 (a). These sorts of agreements are commonly used by closely held corporations to keep control among a small group of people.”
Gillette v. Comm'r, 76 F.2d 6 (2d Cir. 1935). “” It is argued that section 23 (c) (3) does not apply to the present case because, under section 703 (a) (2) of the same Revenue Act of 1928 (26 USCA § 2703 (a) (2), inheritance taxes were to be allowed as a deduction to the beneficiary, if claimed by the latter, and not by the…”
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