The following is part of the estate tax calculation for one of your clients who died in the current year:

ASSET	VALUE
Black Aces Inc.	$6,200,000
Remainder of estate	9,500,000
Total gross estate	$15,700,000
Funeral and administrative expenses	($60,000)
Debts of decedent	(40,000)
Total Deductions for AGE	($100,000)
Adjusted gross estate	$15,600,000
Marital deduction	($-0-)
Charitable deduction	(200,000)
Taxable estate	$15,400,000

Your client solely owned and personally operated Black Aces Inc. for the last 25 years of his life. His will leaves the business outright to his son, $200,000 to charity, and the remainder to his daughter.

Is the estate entitled to apply to pay estate taxes on the farm property in installments under IRC Section 6166, and why or why not?

A)

No, because businesses are ineligible for this special tax election.

B)

No, because the value of the business does not exceed 35% of the adjusted gross estate when prior taxable gifts are considered.

C)

Yes, because the value of the business exceeds 35% of the adjusted gross estate.

D)

Yes, because the value of the business exceeds 25% of the gross estate as adjusted.