Steve Akers, Associate Fiduciary Counsel, Bessemer Trusts, provides the following summary of developments in estate planning over the last several months.
Procedures for Filing Protective Claims for Refund and Subsequently Notifying IRS to Consider Refunds After Contingencies to Section 2053 Claims Have Been Resolved; Procedures Critically Important For Estates With Claims or Expenses of Uncertain Amount
Steve R. Akers, Fiduciary Counsel
Akers@bessemer.com
November 1, 2011
Revenue Procedure 2011-48, 2011-42 IRB 527 (released on October 14, 2011), is critically important for estates with uncertain claims or expenses that cannot be deducted at the time the estate tax return is filed. Unless the procedures in this Revenue Procedure are followed, there will be no ability to deduct claims or expenses that are actually paid or resolved after the period of limitations on federal estate tax refunds has expired. Satisfying all of the detailed requirements in the Revenue Procedure is important for various reasons.
Here are several highlights from the Revenue Procedure:
- Two alternate methods for filing the protective claim for refund;
- Importance of contacting the IRS if the IRS does not send written acknowledgement of receiving the protective claim for refund within a specified time frame;
- Opportunity to cure inadequately identified claims (fortunately, there is no necessity of putting a specific dollar amount on the claim or expense);
- Procedures (including a specific deadline) for notifying the IRS to consider the claim for refund after the claim or expense has been paid or its amount has become certain; and
- Limited scope of review by the IRS in considering the claim (i.e., not raising other possible issues) if all of the procedures in the Revenue Procedure have been followed.
Click here for a more detailed analysis.
Leave a comment