IRS New Guidance for Estates and Trusts; The Internal Revenue Service (IRS) provides new proposed regulations for Estates and Trusts itemizing deductions in USA. With the help of IRS itemizing deductions guidance for estates and trusts, it is much clearer for the stated entities that certain deductions of estates as well as non-grantor trusts are not miscellaneous itemized deductions.

IRS Itemizing Deductions Guidance for Estates and Trusts

Individual taxpayers are prohibited by the Tax Cuts and Jobs Act (TCJA) to claim miscellaneous itemized deductions for any taxable year beginning after December 31, 2017, and before January 1, 2026.

In particular, the proposed regulations for estates and trusts for itemizing deductions clarify many deductions that are not miscellaneous itemized deductions and are allowable in figuring adjusted gross income (AGI). These deductions include the following:

  • Deductions for trusts that accumulate income.
  • Deductions for trusts that distribute current income.
  • Deductions that concern the personal exemption of an estate or a non-grantor trust.
  • Costs paid or incurred with regard to the administration of the estate or trust which would not have been incurred otherwise.

IRS itemizing deductions guidance for estates and trusts helps to clarify the criteria and method to determine the character, amount and manner for allocating excess deductions that beneficiaries succeeding to the property of a terminated estate or non-grantor trust may claim on their individual income tax returns.

It is worth mentioning here that the IRS has extended tax deadline for trusts and estates in USA due to COVID-19 pandemic. If you need any further assistance regarding IRS itemizing deductions guidance for estates and trusts as well as other provisions in TCJA, contact Black Ink Team to answer your tax reform issues in USA. So this was almost everything you need to know about what IRS did to provide new guidance for Estates as well as Trusts.





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