Under usual rules, the basis for heirs is what the asset was worth when the person died. For items inherited this year, though, heirs must "carry over" the basis, valuing the asset at its original cost.
When the estate tax lapsed, a new requirement was made for estates with non-cash assets over $1.3 million to notify the Internal Revenue Service of basis adjustments. The statute lists information that must be contained in the report but also refers to IRS regulations that haven't yet been issued.
Duncan E. Osborne, a partner at Osborne, Helman, Knebel & Deleery, said the newly required tax return hasn't even been issued yet. With the possibility the law may change and no clear knowledge of what tax filings need to be done, it is very difficult for attorneys to close an estate, he said.
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