Lapsed Rights

Rights attached to a security that have expired. For example, a stock may have rights attached to it contingent upon future payment of some amount. If the amount is not paid, the rights lapse.

References in periodicals archive

2704(a)(1) would include the value of the lapsed rights in the father's estate.

2704(a) occurs because the lapsed right can no longer be reclaimed.

Thus, the lapsed right may be considered in valuing D's stock for estate tax purposes.

Thus, if an individual transfers an interest with a lapsing voting or liquidation right within three years of the individual's death, the right is considered to lapse at the individual's death, and the value of the lapsed right is included in the individual's gross estate.

Valuation of family-owned entities for estate and gift tax purposes under sec. 2704

Shareholders who let the rights lapse still receive a payment from BT, which will pool the lapsed rights and sell them on the market after the rights expire.

Personal finance: Don't expect bells to ring over BT, warn analysts

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