|
Posted by Gil Faver on February 21, 2008, 3:46 pm
Please log in for more thread options
>>
>>> Some gifts made within three years of the
>>> date of death are included in the donor's estate.
>>
>> Stuart, as long as we are on this subject, what under what
>> circumstances are gifts included in the donor's estate? Is there
>> any distinction here of gifts made personally, or from a living
>> trust?
>
> The rule is in section 2035 of the Internal Revenue Code. It's
> pretty complex, but the basic rule is:
>
> "(a) If -
>
> "(1) the decedent made a transfer (by trust or otherwise) of an
> interest in any property, or relinquished a power with respect to any
> property, during the 3-year period ending on the date of the
> decedent's death, and
>
> "(2) the value of such property (or an interest therein) would have
> been included in the decedent's gross estate under section 2036,
> 2037, 2038, or 2042 if such transferred interest or relinquished
> power had been retained by the decedent on the date of his death, the
> value of the gross estate shall include the value of any property (or
> interest therein) which would have been so included.
>
> "(b) Inclusion of Gift Tax on Gifts made During 3 Years Before
> Decedent's Death - The amount of the gross estate (determined without
> regard to this subsection) shall be increased by the amount of any
> tax paid under chapter 12 by the decedent or his estate on any gift
> made by the decedent or his spouse during the 3-year period ending on
> the date of the decedent's death."
>
> Subsection (e) of that statute could be what the "someone" was
> thinking of, though all it does is to state the general rule that
> revocable trusts are treated as though they don't exist. It says,
>
> "For purposes of this section and section 2038, any transfer from any
> portion of a trust during any period that such portion was treated
> under section 676 as owned by the decedent by reason of a power in
> the grantor (determined without regard to section 672(e)) shall be
> treated as a transfer made directly by the decedent."
>
> Stu
so, this three year rule is true even if you are not using a living trust.
Does the IRS actually check this? I can't imagine most such gifts are put
back into the decedent's estate tax calculation.
--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>
| 
Yahoo! 
Google 
Windows Live 
del.icio.us 
digg 
Netscape 
XML Sitemap