The U.S. Tax Court has ruled that an executor was personally liable for unpaid estate taxes because he made distributions of the estate’s assets knowing that the estate owed the taxes. In the case, the IRS sent the executor a notice of deficiency claiming the estate owed over $1,000,000. The executor promptly filed a petition in Tax Court disputing the estate tax claim. While the court case was pending, the executor distributed $640,000 of estate assets to heirs. As a result of the distribution, the estate retained assets of only $183,000, which wasn’t enough to satisfy the estate tax claim. Therefore, the executor was personally liable for more than $500,000 of estate tax. (TC Memo 2021-92)