Series 6 - Investment Company And Variable Contracts Products Representative Exam
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A mother bought $12,000 of XYZ stock in 2001. When she died in 2012, the stock was valued at $23,000. If the children decide to sell the stock after inheriting it, what is the fair market value of the stock?
$0
A
$11,000
B
$12,000
C
$23,000
D
Explanations
When a person dies and leaves securities to heirs, the cost basis to the recipient is the fair market value on the date of the account owner's death.