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Section 20.2053-1(b)(3), Estate Tax Regs.,1 forbids the deduction
on the estate tax return of an item unless the amount of the
liability “is ascertainable with reasonable certainty, and will
be paid.” The provision closes with the reassurance that, if the
matter is not resolved by the time of the final audit, then
relief would be available in the Tax Court or in a refund suit.
Respondent’s contentions in the instant case fly in the face
of this reassurance. Having forbidden by regulation the taking
of a deduction, even by way of estimate, on a timely filed estate
tax return, respondent in the instant case proposes to limit the
relief otherwise flowing from the deduction merely because the
1 SEC. 20.2053-1(b)(3), Estate Tax Regs., provides as
follows:
SEC. 20.2053-1. Deductions for expenses, indebtedness, and
taxes; in general. * * *
* * * * * * *
(b) Provisions applicable to both categories.
* * * * * * *
(3) Estimated amounts. An item may be entered on
the return for deduction though its exact amount is not
then known, provided it is ascertainable with
reasonable certainty, and will be paid. No deduction
may be taken upon the basis of a vague or uncertain
estimate. If the amount of a liability was not
ascertainable at the time of final audit of the return
by the district director and, as a consequence, it was
not allowed as a deduction in the audit, and
subsequently the amount of the liability is
ascertained, relief may be sought by a petition to the
Tax Court or a claim for refund as provided by sections
6213(a) and 6511, respectively.
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