New Consistent Basis Reporting Between Estates and Beneficiaries

Sections 1014(f) and 6035 of the Internal Revenue Code, enacted as part of the Surface Transportation and Veterans Health Care Choice Improvement Act of 2015 (P.L. 114-41), require that the basis of inherited property be consistent with the property's value for federal estate tax purposes, and they impose reporting requirements on the value of property that must be reported on Form 706, United States Estate (and Generation-Skipping Transfer) Tax Return. Form 8971, Information Regarding Beneficiaries Acquiring Property From a Decedent, and its instructions to enable executors to comply with the reporting requirements. This presentation will cover which assets are covered by the consistent basis reporting rules under section 1014(f) and which assets need to be reported on Form 8971. Intuitively, the assets subject to basis consistency should be the same as those reported on the Form 8971, but that can't be further from the truth.