Final answer:
Property for federal estate tax may be valued on the decedent's date of death or six months after, known as the alternate valuation date. This choice can impact the estate tax due based on the assets' value change. Understanding estate and gift taxes is important in estate planning for wealth transfer.
Step-by-step explanation:
The possible dates on which property may be valued for federal estate tax purposes are: A) the decedent's date of death, and D) six months after the decedent's date of death, known as the 'alternate valuation date.' There is no valuation date designated as nine months after the decedent's death for the purpose of federal estate tax.
For estate tax planning, it's important to note that the estate's executor has the choice to select the alternate valuation date, which could result in a lower tax if the value of the estate has decreased within that six-month period. This can be particularly beneficial if the estate includes assets that have declined in value since the date of death. However, if the assets have increased in value, it might be more advantageous to use the date of death as the valuation date.
The estate tax threshold changes over time. In 2015, only estates worth more than $5.43 million were subject to the estate tax, affecting a small segment of the population. When planning for estate taxes, it's also important to be aware of gift taxes, which apply to transfers of money or wealth during one's lifetime, as part of overall wealth transfer strategy to minimize tax liabilities.