An Alternative to Estate Tax Closing Letters

December 14, 2015Articles Estate Planning Blog

As detailed in our two previous posts in early July and a week ago, the IRS will no longer automatically be issuing estate tax closing letters. The executor can either call the IRS to request a closing letter (once four months have passed since the filing of an estate tax return) or, through a new procedure published December 4, find out online that the IRS' review of an estate tax return is closed. Under this new procedure, the IRS will be marking account transcripts for estate tax returns with Transaction Code 421 that says "closed examination of tax return." Account transcripts can be accessed online through the Transcript Delivery System or requested by using Form 4506-T. This new online procedure will allow an executor to find out whether review of an estate tax return has been closed much earlier than waiting for the arrival of an estate tax closing letter, resulting in the executor being able to close an estate earlier, while lessening the burden on the IRS.