Bloomberg.com reports that the IRS has extended the deadline for heirs to file. The tax agreement that the Congress passed and Obama signed brought the estate tax back for 2011 and provided that some estates could elect to pay capital gains and not have a full step up in basis for income tax purpose but would have no estate tax while others would be able to keep the step up in basis but would be subject to estate tax rates. For the election and next two years subject to the agreement the exemption amount is $5 million dollars per taxpayer with a maximum rate of 35%. Given the frequently changing estate tax rules this helps personal representatives, heirs and their CPAs to have more time to evaluate their estate tax planning decisions.
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