Wednesday, May 20, 2020
On April 23, 2020, the IRS issued FAQs regarding "COVID-19 Relief for Estate and Gift" in response to issues raised by the extension of time granted to taxpayers to fulfill their estate, gift, and generation-skipping transfer (GST) tax obligations. The FAQs includes these topics:
(1) Form 706 Due Dates
If a Form 706 and payment of an estate tax are due on May 15, 2020, the return and payment are now due on July 15, 2020. However, Notice 2020-23 does not postpone payment of a tax that was due before April 1, 2020, interest will accrue from the date payment was due until the date the payment is made.
Also, if the time to file for a six-month extension to Form 706 expires between April 1, 2020 and July 15, 2020, the extension request can be filed on or before July 15, 2020; however, the six-month extension will be calculated from the original due date. Under section 2032(d), an estate has one year after the due date to file Form 706 to make an alternate valuation election under section 2032(a).
(2) Allocation of GST Exemption
Any GST election or allocation made in regard to a 2019 transfer on a Form 709 due between April 1, 2020 and July 15, 2020, is timely if on a Form 709 filed on or before July 15, 2020. There is no relief available for a late allocation of GST exemption.
(3) Miscellaneous Items: Qualified Disclaimers and Refunds
Regarding qualified disclaimers, if the period of time to make a qualified disclaimer expires on or after April 1, 2020, and before July 15, 2020, then a taxpayer has until July 15, 2020 to make a qualified disclaimer; however the disclaimer must be timely and valid under state law.
See Christopher Lau & Henry Leibowitz, IRS Issues FAQs Regarding COVID-19 Relief for Estate and Gift Tax Filiings, Proskauer, May 19, 2020.
Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.