Scheduled Times are Eastern Time Zone

All New Basis Consistency Regulations & IRS Form 8971

Course ID: CPE Credits Field Of Study Author or Speaker:
EWTFM-T-01379-19-O  01 Credit  Taxes  Bradley Burnett
Instructional Method: Advanced Preparation: Program Prerequisites: Experience Level:
 Group Internet Based   None   None   Basic 





Course Description:

June 30 Deadline for Some Form 8971s is Coming Like a Freight Train. Are You in the Train’s Path Now or Later?
Breaking News!! During tax season, IRS planted a couple of nuclear bombs in its newly issued Form 8971 Basis Consistency Regulations:

1. IRS’ all new ZERO BASIS rule: If tax matters are mishandled at the estate level, the beneficiary’s basis (for income tax purposes) in an inherited asset is zero!!

Any later transfer by a beneficiary (of an asset originally subject to Form 8971 reporting) itself must be reported on a newly generated Form 8971. IRS Form 8971, of course, is the controversial brand new form IRS requires an estate to complete to report the basis of inherited assets to (IRS and) beneficiaries. Penalties for noncompliance can be financially disastrous. Where is all of this coming from? The Highway Funding Bill (P.L. 114-41) created basis mania with 3 new statutes:

• New IRC §1014(f) – Heirs must use the estate tax value of assets received from an estate as their income tax basis

• New IRC §6035 – Executors must report estate tax value of assets to IRS and heirs

• IRC §6501 – the 6-year statute of limitations (on assessment) expanded to apply where overstatement of asset basis omits more than 25% of gross income stated on return IRS issued Form 8971 and prop/temp regs in response. There’s a whole lot to it than meets the eye and some unanswered questions to boot.

Course Outline:

  • Highway Funding Bill Basis Mania
  • §6501 – Extension of 6 Year Statute of Limitations to Basis Overstatements
  • New IRC §1014(f) – Basis Consistency Requirement
  • New IRC §6035 – Basis Reporting to IRS and Heirs
  • Congress Blocks the Trick Play
  • Treasury Response – Proposed and Temp Regs
  • Form 8971
  • Basis Consistency - Penalties for Non-Compliance
  • Zero Basis Rule
  • Later Adjustments to Value
  • Subsequent Transfers
  • Consistent Basis and Form 8971 – Future Outlook

Learning Objectives

To enlighten as to how Congress has mandated basis consistency in a broad variety of contexts, including how the 3 year period of limitations for tax assessment is extended to 6 years, as well as the basis of assets inherited by beneficiaries. To explore the timing and detail of new IRS Form 8971 and the devastating consequences of failure to comply with the vast array of Congress, Treasury and IRS’ new rules.

Intended Audience:

Those desiring to understand the broad, hard-hitting impact and surprisingly far reach of Congress’, Treasury and IRS’ new basis consistency rules. Income tax planners, estate planners and affected taxpayers who desire to maintain the advantage and comply with the broadly applicable and potentially punishing new rules course info table.

Event Properties

Event Date 12-01-2020 3:00 pm
Individual Price 49.00
Categories Federal Tax Updates,Moderated Webinars

Group Rate

#Registrants Rate/Person($)
5 45.05
10 41.10
20 37.15


Art Werner

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