One of the recurring estate planning-related items in the President’s Budget Proposals over the last seven years has been enacted into law. This is important for planners; the legislation is effective immediately and will require planners to take additional steps for all estate tax returns filed after July 31, 2015 if the estate is required to file the return (and is not merely filing to elect portability).
Beneficiaries will be required to use the finally determined estate tax values as the basis of property acquired from a decedent under §1014 (new §1014(f)), and will no longer have the ability to claim that the fair market value of an asset on the date of death was actually greater than the value used for estate tax purposes. Furthermore, executors will be required to furnish information statements to the IRS and to the estate recipients about the values of estate assets(new §6035). Penalties may be imposed if the required information statements are not furnished to the IRS and to estate beneficiaries.
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