Application of the Accuracy-Related Penalty under IRC Section 6662 to an Inconsistent Estate Basis (PDF)
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Under IRC §1014, the basis of inherited property must be consistent with the estate tax return. An accuracy-related penalty applies to any part of an underpayment attributable to inconsistent estate basis. The penalty may apply if the basis of property claimed on the estate tax return exceeds the basis under IRC §1014. This EIA discusses new proposed regs that provide guidance on the consistent basis requirement and the accuracy-related penalty.
Diane L. Mutolo, J.D., LL.M. is a member of the New York Bar, and her LL.M. is in Taxation. She is the update author for the LexisNexis Matthew Bender treatise, How to Save Time & Taxes Preparing Fiduciary Income Tax Returns.
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