Page:United States Statutes at Large Volume 95.djvu/332

 95 STAT. 306

PUBLIC LAW 97-34—AUG. 13, 1981

Subtitle B—Other Estate Tax Provisions 26 USC 2032A.

SEC. 421. VALUATION OF CERTAIN FARM, ETC., REAL PROPERTY. (a) INCREASE IN LIMITATION.—Paragraph (2) of section 2032A(a) (relating to limitation) is amended to read as follows: "(2) LIMIT ON AGGREGATE REDUCTION IN FAIR MARKET VALUE.—

The aggregate decrease in the value of qualified real property taken into account for purposes of this chapter which results from the application of paragraph (1) with respect to any decedent shall not exceed the applicable limit set forth in the following table: "In the case of decedents dying in: 1981 1982 1983 or thereafter

The applicable limit is: $600,000 700,000 750,000."

(b) DEFINITION OF QUALIFIED REAL PROPERTY.— (1) REQUIRED USE CAN BE BY MEMBER OF FAMILY.—Paragraph (1)

of section 2032A(b) (defining qualified real property) is amended by inserting "by the decedent or a member of the decedent's family" after "qualified use" each place it appears. (2) SPECIAL RULES FOR DECEDENTS WHO ARE RETIRED OR DISABLED AND FOR SURVIVING SPOUSES.—Subsection (b) of section 2032A is

amended by adding at the end thereof the following new paragraphs: "(4) DECEDENTS WHO ARE RETIRED OR DISABLED.—

42 USC 401.

"(A) IN GENERAL.—If, on the date of the decedent's death, the requirements of paragraph (IXCXii) with respect to the decedent for any property are not met, and the decedent— "(i) was receiving old-age benefits under title II of the Social Security Act for a continuous period ending on such date, or "(ii) was disabled for a continuous period ending on such date, then paragraph (l)(C)(ii) shall be applied with respect to such property by substituting 'the date on which the longer of such continuous periods began' for 'the date of the decedent's death' in paragraph (I)(C). "(B) DISABLED DEFINED.—For purposes of subparagraph (A), an individual shall be disabled if such individual has a mental or physical impairment which renders him unable to materially participate in the operation of the farm or other business. "(C) COORDINATION WITH RECAPTURE.—For purposes of

subsection (c)(OXBXi), if the requirements of paragraph (l)(C)(ii) are met with respect to any decedent by reason of subparagraph (A), the period ending on the date on which the continuous period taken into account under subparagraph (A) began shall be treated as the period immediately before the decedent's death. "(5) SPECIAL RULES FOR SURVIVING SPOUSES.—

"(A) IN GENERAL.—If property is qualified real property with respect to a decedent (hereinafter in this paragraph referred to as the 'first decedent') and such property was acquired from or passed from the first decedent to the surviving spouse of the first decedent, for purposes of applying this subsection and subsection (c) in the case of the estate

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