Section 2032A Special-Use Valuation
The rule can reduce estate value when qualifying property is actively used in a family business or farm.
Purpose
Special-use valuation can reduce the estate-tax value of qualifying real property.
Qualification
The estate must satisfy statutory ownership, use, participation, and family-related requirements.
Recapture risk
Post-death sale or cessation of qualifying use can trigger additional tax consequences.
Exam strategy
Family farm or business real estate plus estate-tax liquidity pressure should trigger Section 2032A analysis.
The takeaway
Section 2032A can reduce estate value for qualifying business or farm real estate, subject to strict requirements and recapture rules.
Related Summit resources
FAQ
What is the core idea?
Section 2032A can reduce estate value for qualifying business or farm real estate, subject to strict requirements and recapture rules.
What should you identify first?
The rule can reduce estate value when qualifying property is actively used in a family business or farm.
Why does this matter on the CPA Exam?
Understand why qualifying farm or closely held business real estate may be valued based on actual use rather than highest and best use.