Estate Tax Valuation (Form 706)

An estate tax valuation is a signed appraisal of a closely held business interest owned at death, filed with Form 706. FMV values the interest at the date of death and, where an executor may elect it, at the alternate valuation date six months later.

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At a glance

Basis: IRC §2031 and §2032
Prepared by: A credentialed FMV valuation analyst
Deliverable: Signed report (PDF)
Used by: Accounting firms, attorneys
Delivered to: The ordering bank's or firm's vault and the client's vault

When it is needed

An estate holding a closely held business interest.
An executor deciding whether to elect the alternate valuation date.
A buy-sell agreement that must be tested against fair market value.

What the report contains

Signed narrative report consistent with Revenue Ruling 59-60
Date-of-death and alternate-date values where elected
Discount analysis with support
Exhibits formatted for the Form 706 schedules

Last updated October 24, 2026

Who uses it

Accounting firmsEstate work arrives with fixed deadlines. Refer the valuation and receive exhibits laid out for the schedules you are preparing.AttorneysPrepared for estate, gift, and business matters where other parties and their advisors will review the report.

Standards and sources

IRC §2031: Gross estate valuation
IRC §2032: Alternate valuation date
IRC §2703: Buy-sell agreement restrictions
Revenue Ruling 59-60: Valuation factors

Documents we need

Entity documents
Financial statements through date of death
Ownership records
Any buy-sell agreement

How an engagement works

Scope
We confirm the purpose, standard of value, valuation date, and addressee, then issue the engagement letter.
Intake
You or your client upload documents against a checklist. Open items stay visible until the file is complete.
Analysis
A credentialed analyst prepares the valuation and signs the conclusion.
Delivery
The signed PDF goes to your vault and your client's. We keep the workfile for later questions.

Estate tax valuation questions

What is an estate tax valuation?

An estate tax valuation is a signed appraisal of the fair market value of a closely held business interest included in a decedent's gross estate, prepared for Form 706 under IRC §2031. FairMarketValue (FMV) formats its exhibits for the Form 706 schedules.

What is the alternate valuation date?

The alternate valuation date under IRC §2032 is six months after the date of death. An executor may elect it only if doing so reduces both the value of the gross estate and the estate tax, so FMV states both values where the election is possible.

Does an estate below the federal exemption need a business valuation?

Often, yes. The federal estate tax exemption is $15 million per individual for deaths in 2026, but a Form 706 is still filed to elect portability of the unused exemption to a surviving spouse, and the valuation also sets the heirs' income tax basis.

Does a buy-sell agreement set the estate tax value?

Only if it meets IRC §2703. The agreement must be a bona fide business arrangement, must not be a device to transfer value to family members for less than full consideration, and must be comparable to similar arm's-length arrangements. FMV tests the agreement against fair market value in the report.

What documents does an estate tax valuation require?

An estate tax valuation requires the entity documents, financial statements through the date of death, ownership records, and any buy-sell agreement.

How is the fee for an estate tax valuation set?

FMV quotes the fee for an estate tax valuation after reviewing the scope. The fee is fixed before work starts and does not depend on the conclusion of value.