What is the Alternate valuation date for estates?
The alternate valuation date is an optional IRS election under IRC §2032 allowing an executor to value a taxable estate's assets six months after the decedent's death instead of on the death date. The election is available only when it reduces both the total gross estate value and the estate tax owed. Assets sold or distributed during the six-month window are valued as of the disposition date. Because the election applies to all estate assets collectively and directly sets the inherited basis for beneficiaries, it requires careful coordination between estate administration and beneficiary tax planning. Strategies like Sell your home and Tax loss harvesting help beneficiaries optimize gains after the alternate valuation date is established.
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