As discussed in the previous posts, executors must now be aware of their responsibility to file newly created IRS form 8971, titled, “Information Regarding Beneficiaries Acquiring Property From a Decedent.” Form 8971 (including all attached Schedule(s) A must be filed with the IRS and only the Schedule A is to be provided to the beneficiary listed on that Schedule A.
Example: Sam Sutter of Smithtown, NY died on November 1, 2015. At the time of his passing he owned his home in Smithtown, a second home in Commack, NY, investments in the bank and stocks. Mr. Sutter had prepared a Last Will and Testament naming his daughter, Nicole, from Nesconset, NY, his executrix. His will left any and all property that he owned to his three children: Nicole, Kenneth (from Kings Park, NY), and Henry (from Hauppauge, NY), in equal shares. The total value of his estate is $6,000,000.00
Must Nicole file form 8971 and related Schedule A?
Answer: YES. Mr. Sutter’s gross estate is more than $5,430,000.00 (the basic exclusion amount for estates of decedents who die during 2015).
Example 2: Same facts as above. Nicole files the estate tax return on August 1, 2016. What is the due date for filing form 8971?
Answer: She must file form 8971 by August 31 – thirty days after form 706 was filed with IRS.
Example 3: Same facts as above except Nicole files for an extension to file the estate tax return and files the return on the extended due date. What is the due date for filing form 8971?
Answer: She must file form 8971 by March 3, 2017 – thirty days after form 706 was filed with IRS. The extension was filed on the extended due date, February 1, 2017 and thirty days after this date is March 3, 2017.
To be continued….
Aaron E. Futterman, CPA, Esq. is a partner in the law firm of Futterman & Lanza, LLP with offices in Smithtown, NY and clients throughout Suffolk, Nassau, Queens, Brooklyn, Bronx, Richmond, New York, Westchester and Rockland Counties. He concentrates his practice to Elder Law, Medicaid Planning, Medicaid Applications, Estate Planning, Probate, Estate Taxes, and Estate Administration.