2010 Executors – Are You Ready to Allocate that Basis?


Today I was alerted to the existence of a draft of the IRS from that will be required to be filed for estates of decedents dying in 2010 with estates in excess of $1.3 million.  IRS Form 8939 – Allocation of Increase in Basis for Property Received from a Decedent.  The due date is April 15, 2011.

This form is necessitated by the Modified Carryover Basis rules that replaced the estate tax for 2010.  Each decedent’s estate gets $1.3 million worth of basis to allocate to appreciated assets, with an additional $3 million for assets going to a surviving spouse.  IRC Section 1022.  The allocated basis will effectively eliminate capital gains tax liability for assets sold soon after death.
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