A bill to amend the Internal Revenue Code of 1954 to provide that the valuation of a decedent's interest in a ranch, farm, or closely held business may at the election of the executor be determined, for estate tax purposes, solely by reference to its value for such use.

Changes the valuation of a decedent's interest in a ranch, farm or closely held business for estate tax purposes under the Internal Revenue Code of 1954 by giving an option for the business to be valued either at its present value or the higher of the decedent's cost basis, or a value based on the reasonable earning power of the business.

Provides that to qualify for this option the decedent must have had an interest in the farm, ranch or business for at least ten years prior to the valuation date.

Provides that under the market-value alternative all relevant factors should be considered in valuing an interest including the earning capacity of the business, ranch or farm and the degree of control represented by the interest being valued (Adds 26 U.S.C. 2031(c)).