IRS further postpones estate basis reporting from March 31 to June 30

Tax Hot Topics: Estate basis reporting postponedThe IRS has again postponed the new asset value reporting requirements for estates from March 31 to June 30.

Legislation enacted last July imposes new reporting requirements on estates filing estate tax returns after July 31, 2015. These estates are required to report the value of assets for estate tax purposes on information returns that generally must be furnished to the IRS and beneficiaries within 30 days of filing Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return. Beneficiaries must then use these values as the income tax basis for the inherited assets or face a penalty.

The IRS issued a series of notices delaying the reporting requirements so that it could release forms and guidance. Form 8971, Information Regarding Beneficiaries Acquiring Property From a Decedent, and its instructions are now available along with temporary and proposed regulations; and the latest transition relief postpones the initial filing deadline until June 30, 2016. Further deadline relief is unlikely now that all the guidance has been issued, and the relief does not remove the reporting requirements but merely defers reporting. So the executors of estate tax returns filed since July 31 of last year now need to perform the reporting by the end of June (or within 30 days of filing the return, if later).

Tax Flash 2016-03 contains more details on the reporting requirements.

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