Iras in the Gross Estate Not Reduced for Income Taxes
CPA Journal, The › Vol. 76 Nbr. 11, November 2006
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Summary
In Estate of Kahn, the Tax Court ruled that the value of individual retirement accounts (IRA) in the gross estate could not be reduced by the anticipated income taxes paid by the beneficiaries following the distribution of the assets in the IRAs. The court distinguished other situations where it allowed reductions in the value of the gross estate for income taxes and for other reasons. In Estate of Kahn, the Tax Court ruled that the value of the IRAs in the gross estate cannot be reduced for the anticipated income tax, because the seller of the IRA assets would pay the income tax. The Tax Court's ruling provides a logical basis for determining if a reduction in value of assets that are in the gross estate will be allowed. If the reduction in value is passed on to the hypothetical willing buyer of an asset, then a reduction in value will be allowed in the gross estate.
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Iras in the Gross Estate Not Reduced for Income Taxes
In Estate of Kcihn [125 TC No. 11 (2005)], the Tax Court ruled that the value of individual retirement accounts (IRA) in the gross estate could not be reduced by the anticipated income taxes paid by the beneficiaries following the distribution of the assets in the IRAs. The court distinguished oth...
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