Tax News

CCH (cch.taxgroup.com) reports:

  The regulatory actuarial tables used for the valuation of annuities, interests for life or terms of years and remainder or reversionary interests in property have been revised to reflect the most recent mortality experience available (2000). These regulations affect the valuation of inter vivos and testamentary transfers of interests dependant on one or more measuring lives and are generally effective May 1, 2009.

  Pursuant to Code Sec. 7520(c)(3), the IRS is required to revise the tables at least once in each 10-year period. Revised Tables S (Single Life Remainder Factors) and U(1) (Unitrust Single Life Remainder Factors), effective for transfers for which the valuation date is on or after May 1, 2009, are based on data compiled from the 2000 census as set forth in Life Table 2000CM, and make conforming amendments to various provisions to reflect the revised tables. No changes have been made to Tables B, D, F(4.2) through F(14.0), J, and K, which are not based on mortality experience.

  IRS Publications 1457 (Actuarial Valuation Version 3A), 1458 (Actuarial Valuation Version 3, and 1459 (Actuarial Valuation Version 3C) contain complete sets of actuarial tables that include factors not contained in the regulations (TAXDAY, 2009/04/30, I.4). The full text of these publications are available electronically on the IRS website at www.irs.gov.

  Although generally effective for annuities, interests for life or terms of years, and remainder or reversionary interests valued on or after May 1, 2009, the regulations provide transitional rules intended to alleviate adverse consequences resulting from the regulatory changes. For gift tax purposes, if a transfer's valuation date is after April 30, 2009, but before July 1, 2009, the donor may determine the value of the gift and/or any applicable charitable deduction under tables based on either Table 90CM or 2000CM. Similarly, for estate tax purposes, if the decedent dies after April 30, 2009, and before July 1, 2009, the value of any interest and/or applicable charitable deduction may be determined under tables based on either Table 90CM or Table 2000CM, at the option of the decedent's executor. However, the Code Sec. 7520 interest rate utilized is the appropriate rate for the month in which the valuation date occurs.

  With respect to charitable deductions, if the valuation date occurs after April 30, 2009, and before July 1 2009, and the executor or the donor elects to use the applicable federal rate (AFR) for March 2009 or April 2009, valuation tables based on 90CM must be used. If the May 2009 or June 2009 AFR rate is elected, valuation tables based on either 90CM or 2000CM may be used. However, if the valuation occurs after June 30, 2009, the executor or donor must used the tables based on 2000CM, even if a prior month's AFR is elected.

  For estate tax purposes, the estate of a mentally incompetent decedent may elect to value the property interest included in the gross estate under (1) the mortality table and interest rate in effect at the time the decedent became mentally incompetent, or (2) the mortality table and interest rate in effect on the decedent's date of death if the decedent was under a mental incapacity that existed on May 1, 2009, and continued uninterrupted until the date of death, or the decedent died within 90 days of regaining competency after April 30, 2009.

  The text of the temporary regulations also serves as the comment document for a notice of proposed rulemaking. The IRS and Treasury Department are requesting comments concerning the proposed regulations. Written and electronic comments and requests for a public hearing on the proposed regulations must be received by August 5, 2009. Written comments should be sent to CCA:LPDR (REG-107845-07), IRS, Room 5205, PO Box 7604, Ben Franklin Station, Washington, D.C. 20044. Electronic comments may be submitted via the Federal eRulemaking Portal at www.regulations.gov (REG-107845-08).

T.D. 9448, 2009FED ¶47,017

T.D. 9448, FINH ¶43,125

Proposed Regulations, NPRM REG-107845-08, 2009FED ¶49,420

Proposed Regulations, NPRM REG-107845-08, FINH ¶41,140

Other References:

 
Code Sec. 170A

  CCH Reference - 2009FED ¶11,681

  CCH Reference - 2009FED ¶11,683

  CCH Reference - 2009FED ¶11,701

 
Code Sec. 642

  CCH Reference - 2009FED ¶24,294

  CCH Reference - 2009FED ¶24,294C

  CCH Reference - 2009FED ¶24,294E

  CCH Reference - FINH ¶16,725

  CCH Reference - FINH ¶16,730

  CCH Reference - FINH ¶16,735

  CCH Reference - FINH ¶16,750

 
Code Sec. 664

  CCH Reference - 2009FED ¶24,461

  CCH Reference - 2009FED ¶24,464

  CCH Reference - 2009FED ¶24,466

  CCH Reference - 2009FED ¶24,466C

  CCH Reference - 2009FED ¶24,466E

  CCH Reference - FINH ¶16,975

  CCH Reference - FINH ¶17,025

  CCH Reference - FINH ¶17,030

  CCH Reference - FINH ¶17,035

  CCH Reference - FINH ¶17,050

 
Code Sec. 2031

  CCH Reference - 2009FED ¶15,904

  CCH Reference - 2009FED ¶15,904A

  CCH Reference - 2009FED ¶15,904B

  CCH Reference - FINH ¶3025

  CCH Reference - FINH ¶3435

  CCH Reference - FINH ¶3440

  CCH Reference - FINH ¶3445

  CCH Reference - FINH ¶3485

   

 
Code Sec. 2032

  CCH Reference - FINH ¶3830

  CCH Reference - FINH ¶3835

  CCH Reference - FINH ¶3845

 
Code Sec. 2055

  CCH Reference - FINH ¶6390

  CCH Reference - FINH ¶6395

  CCH Reference - FINH ¶6405

 
Code Sec. 2056A

  CCH Reference - FINH ¶7120

  CCH Reference - FINH ¶7125

  CCH Reference - FINH ¶7130

 
Code Sec. 2512

  CCH Reference - FINH ¶10,636

  CCH Reference - FINH ¶10,784

  CCH Reference - FINH ¶10,790

  CCH Reference - FINH ¶10,794

  CCH Reference - FINH ¶10,811

 
Code Sec. 2522

  CCH Reference - FINH ¶11,608

  CCH Reference - FINH ¶11,615

  CCH Reference - FINH ¶11,618

 
Code Sec. 7520

  CCH Reference - 2009FED ¶42,782

  CCH Reference - 2009FED ¶42,782A

  CCH Reference - 2009FED ¶42,782B

  CCH Reference - 2009FED ¶42,782C

  CCH Reference - FINH ¶22,585

  CCH Reference - FINH ¶22,587

  CCH Reference - FINH ¶22,589

  CCH Reference - FINH ¶22,610

  CCH Reference - FINH ¶22,612

  CCH Reference - FINH ¶22,613

  Tax Research Consultant

  CCH Reference - TRC VALUE: 18,104