AICPA Urges Treasury and IRS to Grant 60-Day Extension

March 7, 2016

Washington, D.C. (March 7, 2016) – The American Institute of CPAs (AICPA) has urged the U.S. Department of the Treasury and the Internal Revenue Service (IRS) to delay the estate basis reporting due date from March 31, 2016 until May 31, 2016 because proposed regulations covering the new reporting requirements were not issued until March 2, 2016. 
 
The AICPA’s March 4 letter stated that the 29 days between the release of the proposed regulations and the March 31 due date is “not sufficient time” for taxpayers and tax practitioners to be aware of, and informed about, the proposed regulations and to review, analyze and implement them during a busy tax filing season.  The requested 60-day extension to May 31 would be after the end of this year’s tax filing season.
 
The AICPA explained in its letter that the due date is for filing with the IRS and furnishing to the beneficiary a new Internal Revenue Code section 6035 statement regarding consistent basis reporting between estates and persons acquiring property from a decedent who had an estate tax return due or filed after July 15, 2015 and prior to March 31, 2016.
 
In addition, the letter noted that Schedule A of the new IRS Form 8971, Information Regarding Beneficiaries Acquiring Property from a Decedent, requires an asset listing and that software providers must have time to update their software in order for practitioners to compile the information required, especially when an asset is being split between multiple beneficiaries.  Of primary concern, the AICPA stated, are returns where there is a significant volume of assets (e.g., many securities within numerous brokerage accounts) that require updated software to effectively bridge the data.
 
The AICPA identified when a supplemental filing is needed and when a zero basis might apply as two important issues in the proposed regulations.
 
The AICPA stated that it plans to provide additional comments on the proposed regulations.