Form 706, Federal united States Estate (and Generation Skipping Transfer) Tax Return is required for taxable estates. If the estate is also subject to probate, then an “estate tax closing letter” is filed with the probate court. This letter confirms that all estate taxes have been paid and the estate can be closed.
Prior to June 1, 2015, the Internal Revenue Service (the “IRS”) issued an estate tax closing letter for every estate tax return filed. After June 1, 2015, the IRS advised taxpayers that an estate tax closing letter will only be issued at the estate’s request.
A recently published notice, Notice 2017-12, provides an account transcript is available as a replacement for the estate tax closing letter. A transcript is a computer generated report. Among the items reported on the transcript are the date the return was received, payment history, refund history, penalties and interest assessed, if any, balance due and date the examination was closed. If the transcript includes transaction code 421 and the explanation “closed examination of tax return”, then the transcript can be used as an alternative to the estate tax closing letter.
To receive this account transcript, an estate’s authorized representative must file a Form 4506-T, Request for Transcript of Tax Return. If the representative still needs an estate tax closing letter, then the representative can call the IRS at 866.699.4083 no sooner than 4 months after filing of the estate tax return.
ADVICE: Look at alternatives if you can not get the estate tax closing letter. Get the transcript! It probably will be faster and it is free.