Decedent Transition Tax Liability Puts Estates In Tough Spot

By Carlos Somoza (May 23, 2019, 2:49 PM EDT) -- The Tax Cuts and Jobs Act of 2017 introduced a one-time "transition" tax under Internal Revenue Code Section 965 on the deferred earnings and profits of certain foreign corporations owned by U.S. persons. To alleviate the harsh consequences of this tax, Congress allowed the tax liability to be deferred and paid over an eight-year period or until the occurrence of an "acceleration event." Recent regulations by the U.S. Department of the Treasury clarify the definition of an acceleration event to include a taxpayer's death and place additional burdens on the decedent's estate, its beneficiaries and transferees.  ...

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