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Jan. 5 — Anxiously awaited instructions to IRS Form 8971 for reporting the basis of estates have now been submitted to the Office of Management and Budget for review.
Form 8971, Information Regarding Beneficiaries Acquiring Property From a Decedent, tells estate executors and others required to file a Form 706 how to report the final estate tax value of a property to the Internal Revenue Service and beneficiaries receiving the property from the estate.
Form 706 is the United States Estate (and Generation-Skipping Transfer) Tax Return.
The instructions appear on the Office of Information and Regulatory Affairs website.
The instructions aren't yet the final draft, the IRS said Jan. 5, but have been submitted to the OMB via the Treasury Department to secure approval under the Paperwork Reduction Act to issue the new form. By law such submissions must be made available to the public.
The IRS will eventually issue draft instructions, which will appear on the IRS website for draft forms, it said.
The draft Form 8971 was posted on the IRS Forms & Publications website on Dec. 18.
Thirty-Day Time Frames
Consistency in basis reporting between estates and beneficiaries was driven by the Surface Transportation and Veterans Health Care Choice Improvement Act (Pub. L. No. 114-41), which was enacted July 31.
Form 8971, including all attached Schedule As, must be provided to the beneficiary listed on Schedule A no later than the earlier of:
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