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Evidence from tax returns shows that a higher gap between estate tax liability and prospective carryover-basis capital gains reduces the likelihood of filing an estate tax return. For many estates, the carryover regime implied a smaller total tax burden due to broader vs narrower bases and lower 2010 capital gains rates, though specific estate traits could favor the estate tax option.",{"@graph":63,"@context":118},[64,80,101],{"@type":65,"itemListElement":66},"BreadcrumbList",[67,71,74,77],{"item":68,"name":69,"@type":70,"position":9},"https://docshare.wps.com","Home","ListItem",{"item":72,"name":10,"@type":70,"position":73},"https://docshare.wps.com/template/",2,{"item":75,"name":51,"@type":70,"position":76},"https://docshare.wps.com/template/general/",3,{"item":78,"name":59,"@type":70,"position":79},"https://docshare.wps.com/template/choosing-between-an-estate-tax-and-a-basis-carryover-regime-evidence-from-2010/302406/",4,{"url":78,"name":59,"@type":81,"image":82,"author":87,"headline":59,"publisher":90,"fileFormat":93,"inLanguage":57,"description":61,"dateModified":94,"datePublished":95,"encodingFormat":93,"isAccessibleForFree":96,"interactionStatistic":97},"DigitalDocument",{"url":83,"@type":84,"width":85,"height":86},"https://docshare.wps.com/thumbnails/choosing-between-an-estate-tax-and-a-basis-carryover-regime-evidence-from-2010/302406.png","ImageObject",442,249,{"name":88,"@type":89},"Aria","Person",{"url":68,"name":91,"@type":92},"DocShare","Organization","application/pdf","2026-09-22","2026-09-19",true,{"@type":98,"interactionType":99,"userInteractionCount":73},"InteractionCounter",{"@type":100},"ViewAction",{"@type":102,"mainEntity":103},"FAQPage",[104,110,114],{"name":105,"@type":106,"acceptedAnswer":107},"What choice did executors have for estates involving decedents in 2010?","Question",{"text":108,"@type":109},"Executors could choose an estate tax regime or a basis carryover regime for estates of decedents in 2010.","Answer",{"name":111,"@type":106,"acceptedAnswer":112},"Why does choosing one regime affect taxes for beneficiaries?",{"text":113,"@type":109},"Estate-tax filing typically shifts taxes to the current period, while basis carryover defers tax to beneficiaries’ future capital gains when assets are sold.",{"name":115,"@type":106,"acceptedAnswer":116},"What do the tax-return evidence indicate about estate tax return filing?",{"text":117,"@type":109},"A larger percentage difference between estate tax liability and prospective tax liability under the carryover basis regime reduces the likelihood of filing an estate tax return.","https://schema.org",{"og:url":78,"og:type":120,"og:title":59,"og:site_name":91,"og:description":61},"article",{"robots":122,"canonical":78},"index,follow",{"doc_id":124,"site_id":56},302406,1790121593,{"code":4,"msg":5,"data":127},{"doc_id":124,"user_id":128,"nickname":88,"user_avatar":129,"doc_module":9,"category_id":50,"category_name":51,"doc_title":59,"doc_description":61,"doc_content":130,"file_id":131,"file_url":132,"file_type":133,"file_size":134,"view_count":73,"is_deleted":4,"is_public":9,"is_downloadable":9,"audit_status":9,"page_count":135,"language":136,"language_code":57,"site_id":56,"html_lang":57,"table_of_contents":137,"faqs":138,"seo_title":139,"seo_description":61,"update_tm":140,"read_time":141},2336464648322,"https://ap-avatar.wpscdn.com/avatar/2200025388227c56fec?_k=1778556882303663488","CHOOSING BETWEEN AN ESTATE TAX ANDA BASIS CARRYOVER REGIME: EVIDENCE FROM 2010  \nRobert N. Gordon, David Joulfaian, and James M. Poterba  \nExecutors of estates for decedents in 2010 could choose between an estate tax regime and a basis carry-over regime. This typically created a tradeoff between a current estate tax payment and a future capital gains tax liability for beneficiaries who inherited assets with carryover-basis. Some executors chose to file estate tax returns, but these filings yielded very little estate tax revenue. Evidence from tax returns suggest that an increase of one percent of estate value in the difference between estate tax liability and prospective tax liability under the carryover basis regime reduced the likelihood offiling an estate tax return by between 0.3 and 1.5 percentage points.  \nKeywords: estate tax, carryover basis, capital gains taxation  \nJEL Codes: H24, H31  \nUndtheeretsteetrmaxseoxfp2001in 20Ec10onanomd wicaGsrrowepltaaedndbyTaaxbRaesiiecRrreconcyoveriatxngActime, Rather than paying an estate tax, executors of estates of decedents in 2010 were required to report accrued gains on assets transferred at death. Heirs were subject to income taxon these gains if and when they sold the assets they received. On December 17, 2010, the estate tax was reintroduced for 2011 as part of the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010. The estates of decedents who died in 2010 were unexpectedly given the option of being taxed under the 2011 estate tax law, or under the basis carryover regime that had prevailed until new law was enacted.  \nRobert N. Gordon: Twenty-First Securities Corporation, New York, NY, USA, and New York University, New York, NY, USA ([bob@twenty-first.com](bob@twenty-first.com))  \nDavid Joulfaian: Office of Tax Analysis, U.S. Department of the Treasury, Washington, DC, USA, and Georgetown University, Washington, DC, USA ([David.Joulfaian@treasury.gov](David.Joulfaian@treasury.gov))  \nJames M. Poterba: Massachusetts Institute of Technology, Cambridge, MA, USA, and National Bureau of Economic Research, Cambridge, MA, USA ([poterba@mit.edu](poterba@mit.edu))  \nFor many estates, the total tax burden under the basis carryover regime was smaller than that under the estate tax regime, because the estate tax base is generally broader than that for the carryover regime, and because the capital gains tax rate in 2010 (15 percent) was lower than the estate tax rate of 35 percent. But specific estate characteristics matter, and the basis carryover regime does not uniformly dominate the estate tax regime. Choosing the estate tax option could be the lower-tax strategy for highly leveraged estates since debts are deductible under the estate tax but not so under the carryover regime, for estates of decedents from community property states in which the transfer at death escapes estate taxation while also benefiting from set-up on both decedent and spousal share of property, and for taxable estates with total value only slightly greater than the estate tax exemption of $5 million. Perhaps for some of these reasons, the executors of some estates for 2010 decedents chose to file estate tax returns and to pay the associated estate taxes.  \nThis paper explores how the availability of the basis carryover regime affected estate tax filing decisions, with the goal of learning whether executors chose between the two tax regimes to minimize taxes. The analysis compares estate tax returns of decedents in 2010 to those from the prior and subsequent years. Not surprisingly, the characteristics ofthe estates for which estate tax returns were filed in 2010 differ from those of the 2009 and 2011 filings. The 2010 estates were more indebted, bequeathed more to charity, made fewer lifetime gifts, and were more likely to be from married individuals living in a state with an estate or inheritance tax.  \nThe tax returns filed in connection with the basis carryover tax regime provide ","cbCaioQSKCw304Ik","https://ap.wps.com/l/cbCaioQSKCw304Ik","pdf",381259,22,"English","# Overview\n## Regime choice and tax trade-offs\n# Institutional background\n## Estate tax reintroduction for 2011\n# Evidence and findings\n## Filing likelihood and estate characteristics\n## Unrealized gains and data limitations\n# Research design and structure\n## Section plan and analysis approach","[{\"question\":\"What choice did executors have for estates involving decedents in 2010?\",\"answer\":\"Executors could choose an estate tax regime or a basis carryover regime for estates of decedents in 2010.\"},{\"question\":\"Why does choosing one regime affect taxes for beneficiaries?\",\"answer\":\"Estate-tax filing typically shifts taxes to the current period, while basis carryover defers tax to beneficiaries’ future capital gains when assets are sold.\"},{\"question\":\"What do the tax-return evidence indicate about estate tax return filing?\",\"answer\":\"A larger percentage difference between estate tax liability and prospective tax liability under the carryover basis regime reduces the likelihood of filing an estate tax return.\"}]","Choosing Between an Estate Tax and a Basis Carryover Regime - Evidence from 2010 | PDF",1789792535,8]