cost basis of inherited bond

You are allowed to value the estate date of death or 6 months later. Entire estate, you cannot pick and choose. Usually, later is better, unless of course, stock tanked during that time.

Joe

I think that the "Alternative Valuation Date" can only be used to decrease the estate value (and therefore basis) rather than increase the estate value. Also, if the value of the estate is below that where there would be an estate tax, it is not an available option.

states ===================================================Executor may elect to value assets included in the decedent's estateat the alternate valuation date. Section 2032. a. If property is not distributed or sold within six months, the property may be valued at a date 6 months after the date of decedent's death;

b. If property sold or distributed within 6 months of date of death, property is valued on date of sale or distribution.

c. Election cannot be made unless both the value of gross taxable estate and federal estate tax due are reduced by the use of the alternate valuation date (to avoid step-up in basis where no transfer tax assessed currently, i.e. taxable estate under $675,000).

d. Any interest whose value is affected by mere lapse in time is included in estate at value on alternative valuation date with adjustment for change in value not due to mere lapse of time. ============================================================