The Internal Revenue Service announced that a $67 user fee will apply to any estate that requests a closing letter for its federal estate tax return beginning on October 28.
The new user fee was authorized under final regulations, TD 9957, published in the Federal Register. Closing letter requests must be made using Pay.gov. The IRS will provide further procedural details before the user fee goes into effect.
Federal agencies are required by law to charge a user fee to cover the cost of providing certain services to the public that confer a special benefit to the recipient, and they must review these fees every two years to determine if they are recovering the cost of these services.
The IRS determined that issuing closing letters is a service that confers a special benefit warranting a user fee under these final regulations, because while obtaining a closing letter from the IRS can be helpful to an executor of an estate, it is not required by law. Also, the estate has the option of obtaining an account transcript from the IRS for free that shows certain information from the estate tax return comparable to that found in a closing letter. The final regulations note that account transcripts can be used to confirm that an estate tax return examination has been completed and the IRS file has been closed, which is the reason closing letters are most often requested.