flower bond

Flower bond

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

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.
References in periodicals archive ?
Such a flower bond, which may be viewed as a straight bond plus an insurance policy, will consequently trade at a lower yield reflecting the embedded insurance policy.
Smith, 1987, "Death and Taxes: The Market for Flower Bonds," Journal of Finance 42, 685-698.