The IRS has recently issued final Form 8971 as well as instructions for a requirement that will now be placed on the executors of estates filing a Form 706. “The Form requires a schedule for each beneficiary which lists the assets received by the beneficiary and the estate tax value of those assets.” The purpose is to allow the beneficiary to be able to calculate the gain or loss on any assets they received. This new form will have to be filed within 30 days of the Form 706 filing. The process of filing a Form 8971 might be complex and difficult for practitioners. Some may argue for Congress to introduce an amendment to permit the deferment of the due date for the Form 8971 “until either actual distribution is made to the beneficiary or the assets to be distributed to the beneficiary can be precisely identified.”
See Charles Rubin, Form 8971 Filing Unhappiness, Rubin On Tax, February 3, 2016.
Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.
