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Doesn't the estate of the seller still need to pay estate taxes to the govt? Looks like the estate taxes are most likely going up next year which may have prompted the sale.

Yes, the taxable estate over the exemption level will result in taxes but the taxes to be paid will be based on the rate in effect during the year in which the person died. My understanding is that the step-up in basis occurs on the date of death. Therefore, in this particular case, assuming the individual died this year, the tax will be 35% of the amount over $5 million.

People are trying so damn hard to come up with "gotchas" on Buffett and taxes that they are either willfully ignorant of the tax laws or aware of them but misstating reality on purpose. The estate MAY have saved some money on capital gains taxes if the Berkshire shares sold at $131K yesterday was a higher price than where the shares traded on the day the person died. The basis is the date the person died. So this is totally immaterial.

The only way someone can avoid having their estate taxed at next year's (likely) higher estate tax rate is to accelerate their death into 2012. I don't think there is any other way. This is the same ghoulish topic that came up in 2010 when the estate tax was repealed for one year before it sprang back to life in 2011. People will (rightfully, in my view) do whatever they can to protect their estates from the ravenous gluttons in Washington but accelerating their own expiration date is typically a step too far for most.
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