Rev. Rul. 65-82

Prior to the issuance of regulations under section 691(e) of the Internal Revenue Code of 1954, relating to the release of a bond filed under section 44(d) of the Internal Revenue Code of 1939 with respect to certain installment obligations transmitted at death, taxpayers may elect to treat the obligations as obligations to which section 691(a)(4) of the Code applies.

The election should be made by the filing, with respect to each bond to be released, of a statement, in duplicate, with the District Director of Internal Revenue for the district in which the bond is maintained, containing the following information:

(1) The name and address of the decedent from whom the obligations to which the bond relates were transmitted, the date of his death, and the internal revenue district in which the last income tax return of the decedent was filed.

(2) A schedule of all obligations to which the bond relates on which is listed:

(i) The name and address of the obligors, face amount, date of maturity, and manner of payment of each obligation,

(ii) The name, identifying number, and address of each person holding the obligations, and

(iii) The name, identifying number, and address of each person who at the time of the election possesses an interest in each obligation, and a description of such interest.

(3) The total amount of income in respect of the obligations which would have been reportable as income by the decedent if he had lived and received such payment.

(4) The amount of income referred to above which has previously been included in gross income.

(5) An unqualified statement, signed by all persons holding the obligations, that they elect to have the provisions of section 691(a)(4) of the Internal Revenue Code of 1954 apply to such obligations and that such election shall be binding upon them, all current beneficiaries, and any person to whom the obligations may be transmitted by gift, bequest, or inheritance.

(6) A declaration that the election is made under the penalties of perjury.

A properly filed election applies only to the liability under a bond for taxable years to which the election applies. Liability under a bond for prior years shall not be released until the district director is assured that the proper portion of each installment payment received in such years has been reported and the tax thereon paid.

¹ Based on Technical Information Release 677, dated Jan. 19, 1965.