Washington, D.C. (April 21, 2023) – The American Institute of CPAs (AICPA) submitted suggestions for improvements to the Internal Revenue Service (IRS) on the current section 645 final regulations election to treat a trust as part of an estate (TD 9032). These recommendations will simplify filing for taxpayers and practitioners and will reduce the administrative burden on the IRS as well.
TD 9032 describes the procedures and requirements for making an election to have certain revocable trusts treated and taxed as part of an estate. The Taxpayer Relief Act of 1997 added section 645 to the Internal Revenue Code to permit the election.
The AICPA recommends the following:
Provide clarification of the “applicable date” of final determination.
Simplify reporting for Form 8855 to require that it be filed as part of the initial estate income tax return rather than being filed separately.
Provide guidance regarding the Section 642(c) deduction.
“These regulations have existed for over 20 years and need to be updated now that there is a new estate tax closing letter process,” said Eileen Sherr, AICPA Director, Tax Policy and Advocacy. “The regulations should be further clarified and the reporting simplified to make it easier for taxpayers to comply and the IRS to administer.”
About the American Institute of CPAs
The American Institute of CPAs® (AICPA®) is the world’s largest member association representing the CPA profession, with more than 421,000 members in the United States and worldwide, and a history of serving the public interest since 1887. AICPA members represent many areas of practice, including business and industry, public practice, government, education and consulting. AICPA sets ethical standards for its members and U.S. auditing standards for private companies, not-for-profit organizations, and federal, state and local governments. It develops and grades the Uniform CPA Examination, offers specialized credentials, builds the pipeline of future talent and drives continuing education to advance the vitality, relevance and quality of the profession.
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Contact: Veronica L. Vera
202-434-9215
Veronica.Vera@aicpa-cima.com