Article On Basis Consistency Temporary And Proposed Regulations

Steve R. Akers (Senior Fiduciary Counsel, Bessemer Trust) recently published an article entitled, Basis Consistency Temporary and Proposed Regulations, Bessemer Trust, March 8, (2016). Provided below is an abstract of the article:

Temporary and proposed regulations provide guidance (and surprises) regarding basis consistency and reporting requirements. A few of the notable features include:

• The IRS confirmed that estates that file an estate tax return merely to make the portability election are not subject to the reporting rules;
• An exception applies for certain tangible personal property; After-discovered or omitted property has a basis of zero unless it is reported on an estate tax return before the limitations period on assessments expires;
• Reporting is not needed for cash, IRD, certain tangible personal property, and property that is sold by the estate;
• Recipients of property from the decedent’s gross estate who subsequently give those assets to “related transferees” must give basis information to the transferees (even many years in the future); and Property subject to non-recourse debt gets a new basis based on the full gross value of the property, not reduced by the debt.

Special thanks to Scott M. Deke (Senior Vice President, Bessemer Trust) for bringing this article to my attention.