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Fred and Pearl Always Have Lived in a Community Property  Date of Death  Six Months Later $5,300,000$5,200,000\begin{array}{ll}\text { Date of Death } & \text { Six Months Later } \\\$ 5,300,000 & \$ 5,200,000\end{array}

question 55

Essay

Fred and Pearl always have lived in a community property state. At the time of Fred's prior death, they held stock that cost them $600,000 but was valued as follows.  Date of Death  Six Months Later $5,300,000$5,200,000\begin{array}{ll}\text { Date of Death } & \text { Six Months Later } \\\$ 5,300,000 & \$ 5,200,000\end{array} Under Fred's will, his half of the stock passes to their daughter, Brandi. What income tax basis will Pearl and Brandi have in the stock, if Fred's estate:
a. Elects the alternate valuation date?
b. Does not elect the alternate valuation date?


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