The Treasury Department and IRS have issued proposed regulations that help clarify the application of the basis consistency and corresponding information reporting requirements.  These new proposed regulations also (1) include surprising new stiff rules regarding the basis of after-discovered or omitted assets not reported on an estate tax return and (2) impose additional reporting requirements when inherited assets are subsequently transferred by gift to a related party.  Although the regulations have not been finalized, compliance will be required: any estate that filed a required estate tax return after July 31, 2015 and for which information returns are due will be required to comply with the information reporting requirements by March 31, 2016.

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