Question: I have a record of the value on Dec. 31, 1976 of my stocks and bonds, which I understood my children would need to have after my death. But I heard recently that this was no longer necessary. What's the story?

Answer: You heard right. Anbody out there who has kept this imformation can now throw it away.

Here's what happened. For years, an heir inheriting property used as his cost basis the value of the property on the date of death or, in some cases, a date six months after death.

This meant that any increase in value from the date of pruchase by the original owner to the date of his death escaped capital gains tax; though not necessarily estate tax.

In order to close this loophole, the Tax Reform Act of 1976 required a person reporting a capital gain on the sale of inherited property to use the cost basis of the one from whom the property was inherited.

To avoid an unfair (and possibly illegal) retroactive impact, the new law providedfor the use of the value on Dec. 31, 1976 for property passed on after that date. That's why financial counselors -- including me -- cautioned everyone to make a record of assets with the values on Dec. 31, 1976.

But this particular tax reform didn't stick. In 1978 the application of the rule was suspended while Congress took another look.

And now it has been eliminated altogether. The provision of the 1976 act applying to the tax basis of inherited property has been repealed, and the old rule is back in effect.

So if an heir sells property that had been inherited, the cost basis for calculating gain is the value on the date of death. (Or the value six months after death -- an option available to the executor when filling the estate tax return.) You can now get rid of that Dec. 31, 1976 record.

What happens if you had already sold property inherited from someone who died after Dec. 31, 1976, and used the "reform" provision in calculating the capital gain? You may now file an amended return under the old (and now restated) provisions, if it will result in a lower tax.

You have three years from the due date of the old return in which to file an amendment. So if the transaction was reported on your 1977 income tax return, you must submit the amendment, (using IRS Form 1040-X) by April 15, 1981. y

Q: My wife and I have separated and are considering a divorce. A couple of years ago, I set up an IRA in her name to go with my own. There are several thousand dollars in the account now. Can I get my money back?

A: No way -- mostly because it isn't your money any more. When you established the "spousal IRA" -- the technical name for such an arrangement -- your wife acquired a vested interest in the account and in each subsequent deposit as it was made.

That means that as soon as any money was placed in the account, it became hers irrevocabley. The money cannot be retrieved by you regardless of what happens to your marriage.

In fact, one of the reasons advanced for setting up the spousal IRA mechanism was to provide some measure of financial protection for a wife who was not working outside the home. This small personal share of her husband's earnings was at least a nod in the direction of recognizing a wife's contributions to the family income.

Q: Recently my wife and I had wills prepared. We are confused by the terms per stirpes and per capita used by our attorney, although we thought we understood them in his office. Can you explain?

A: It may be a little easier to follow an explanation in print. A loose translation of per capita might be "by head count," while per stirpes means "by family line."

Let's try a simple example. Assume a person has three children, each of whom in turn has two children. one of the three children dies before the parent and thus before the will comes into effect.

In a per stirpes distribution, each of the two surviving children would receive one-third of the estate. The two grandchildren together would receive the last third -- the equal share of the deceased child who was their parent.

If the will had specified per capita, the executor would count four eligible heirs: the two surviving children plus the two grandchildren, the children of the child who had died. Each one would then receive one-fourth of the estate. t