IRS Extends Relief for Trusts, Estates on Costs Subject to 2 Percent Floor

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IRS says it is extending, for another year, guidance offering interim relief for certain trusts and estates on the treatment of investment advisory costs and other costs subject to a 2 percent floor under tax code Section 67(a). In Notice 2010-32, IRS addresses costs that are integrated as part of one commission or fee, or a “bundled fiduciary fee,” paid to a trustee or executor. IRS says taxpayers will not be required to determine the portion of a bundled fiduciary fee that is subject to the 2 percent floor for any taxable year beginning before Jan. 1, 2010. Instead, “taxpayers may deduct the full amount of the bundled fiduciary fee without regard to the 2 percent floor,” IRS says.  

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