IRS Notice 2011-37, 2011-20 IRS (4/13/2011)  

Previously, the IRS released notices in response to the 2008 Knight case that held that trust investment advisory fees are subject to the 2% floor on miscellaneous itemized deductions under IRC Section 67(e). The prior notices confirmed that fiduciaries preparing 2007, 2008 and 2009 income tax returns would not be required to unbundle a unitary fiduciary fee to separately state the components of the fee that are subject to the 2% floor.

This notice again extends the relief of trustees from the need to unbundle their fees. Unlike prior notices, this notice provides the extension to all taxable years that begin before the date the final regulations are published. In other words, when final regulations are issued, any unbundling requirement will not be applied retroactively to any year that has already begun. Therefore, Trustees may deduct the full amount of the bundled fiduciary fees for 2010 and 2011 without regard to the 2% floor.