IRS Extends Guidance on Trustee Fees

The IRS announced that it is extending interim guidance on the treatment of investment advisory fees and other costs subject to the 2% floor under IRC § 67(a) (Notice 2011-37). Under the notice, nongrantor trusts and estates will not be required to unbundle their fiduciary fees to determine what portion is subject to the 2% threshold for itemized deductions. Instead, taxpayers will be allowed to deduct the full amount of bundled fiduciary fees without regard to the 2% floor.


The notice extends treatment that was originally issued in Notice 2008-32, effective for tax years beginning before Jan. 1, 2008. Subsequent notices extended the treatment to years beginning before Jan. 1, 2009, and then Jan. 1, 2010. Notice 2011-37 abandons the approach of extending the treatment one year at a time and extends it to any tax year beginning before the date final regulations under Treas. Reg. § 1.67-4 are published in the Federal Register.


The IRS and the Treasury Department intend to conform the regulations to the Supreme Court’s decision in Michael J. Knight, Trustee of William L. Rudkin Testamentary Trust v. Commissioner, 552 U.S. 181 (2008), but so far have not done so.


More from the JofA:


 Find us on Facebook  |   Follow us on Twitter  |   View JofA videos


Year-end tax planning and what’s new for 2016

Practitioners need to consider several tax planning opportunities to review with their clients before the end of the year. This report offers strategies for individuals and businesses, as well as recent federal tax law changes affecting this year’s tax returns.


News quiz: Retirement planning, tax practice, and fraud risk

Recent reports focused on a survey that gauges the worries about retirement among CPA financial planners’ clients, a suit that affects tax practitioners, and a guide that offers advice on fraud risk. See how much you know with this short quiz.


Bolster your data defenses

As you weather the dog days of summer, it’s a good time to make sure your cybersecurity structure can stand up to the heat of external and internal threats. Here are six steps to help shore up your systems.