flower bond

Flower Bond

Fixed income products that were originally purchased by investors at a discount for the purpose of paying federal estate taxes upon their maturity.

Notes:

Investors would purchase these bonds before their death in anticipation of federal estate taxes. If the bondholder passed away, the bonds would mature at par value and be used as payment for the deceased's federal estate taxes.

Also known as estate tax anticipation bonds, the last of these bonds matured in 1998.

See also: Bond, Estate, Estate Tax, Maturity, Par Value

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Flower bond

Government bonds that when owned at the time of death are acceptable at par in payment of federal estate taxes.

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flower bond

Any of a limited series of U.S. government bonds that may be used at par to pay federal estate taxes. The bond is unique because there is no minimum time for which it must be held; further, its holder does not have to wait until maturity to use it at par for paying the tax. Flower bonds have not been issued since 1971.