-CITE-
26 USC CHAPTER 12 - GIFT TAX 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle B - Estate and Gift Taxes
CHAPTER 12 - GIFT TAX
-HEAD-
CHAPTER 12 - GIFT TAX
-MISC1-
Subchapter Sec.(!1)
A. Determination of Tax Liability 2501
B. Transfers 2511
C. Deductions 2521
-SECREF-
CHAPTER REFERRED TO IN OTHER SECTIONS
This chapter is referred to in sections 529, 1015, 2001, 2012,
2035, 2207A, 2612, 2632, 2642, 2651, 2652, 2661, 2663, 2701, 6103,
6161, 6212, 6324, 6501, 6901, 6905, 7463, 7477, 7517, 7851, 7872 of
this title.
-FOOTNOTE-
(!1) Section numbers editorially supplied.
-End-
-CITE-
26 USC Subchapter A - Determination of Tax Liability 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle B - Estate and Gift Taxes
CHAPTER 12 - GIFT TAX
Subchapter A - Determination of Tax Liability
-HEAD-
SUBCHAPTER A - DETERMINATION OF TAX LIABILITY
-MISC1-
Sec.
2501. Imposition of tax.
2502. Rate of tax.
2503. Taxable gifts.
2504. Taxable gifts for preceding calendar periods.
2505. Unified credit against gift tax.
AMENDMENTS
1981 - Pub. L. 97-34, title IV, Sec. 442(a)(4)(E), Aug. 13, 1981,
95 Stat. 321, substituted "preceding calendar periods" for
"preceding years and quarters" in item 2504.
1976 - Pub. L. 94-455, title XX, Sec. 2001(c)(2)(B)(i), Oct. 4,
1976, 90 Stat. 1853, added item 2505.
1970 - Pub. L. 91-614, title I, Sec. 102(a)(4)(B), Dec. 31, 1970,
84 Stat. 1840, substituted "Taxable gifts for preceding years and
quarters" for "Taxable gifts for preceding years" in item 2504.
-End-
-CITE-
26 USC Sec. 2501 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle B - Estate and Gift Taxes
CHAPTER 12 - GIFT TAX
Subchapter A - Determination of Tax Liability
-HEAD-
Sec. 2501. Imposition of tax
-STATUTE-
(a) Taxable transfers
(1) General rule
A tax, computed as provided in section 2502, is hereby imposed
for each calendar year on the transfer of property by gift during
such calendar year by any individual resident or nonresident.
(2) Transfers of intangible property
Except as provided in paragraph (3), paragraph (1) shall not
apply to the transfer of intangible property by a nonresident not
a citizen of the United States.
(3) Exception
(A) Certain individuals
Paragraph (2) shall not apply in the case of a donor who,
within the 10-year period ending with the date of transfer,
lost United States citizenship, unless such loss did not have
for one of its principal purposes the avoidance of taxes under
this subtitle or subtitle A.
(B) Certain individuals treated as having tax avoidance purpose
For purposes of subparagraph (A), an individual shall be
treated as having a principal purpose to avoid such taxes if
such individual is so treated under section 877(a)(2).
(C) Exception for certain individuals
Subparagraph (B) shall not apply to a donor meeting the
requirements of section 877(c)(1).
(D) Credit for foreign gift taxes
The tax imposed by this section solely by reason of this
paragraph shall be credited with the amount of any gift tax
actually paid to any foreign country in respect of any gift
which is taxable under this section solely by reason of this
paragraph.
(E) Cross reference
For comparable treatment of long-term lawful permanent
residents who ceased to be taxed as residents, see section
877(e).
(4) Burden of proof
If the Secretary establishes that it is reasonable to believe
that an individual's loss of United States citizenship would, but
for paragraph (3), result in a substantial reduction for the
calendar year in the taxes on the transfer of property by gift,
the burden of proving that such loss of citizenship did not have
for one of its principal purposes the avoidance of taxes under
this subtitle or subtitle A shall be on such individual.
(5) Transfers to political organizations
Paragraph (1) shall not apply to the transfer of money or other
property to a political organization (within the meaning of
section 527(e)(1)) for the use of such organization.
(b) Certain residents of possessions considered citizens of the
United States
A donor who is a citizen of the United States and a resident of a
possession thereof shall, for purposes of the tax imposed by this
chapter, be considered a "citizen" of the United States within the
meaning of that term wherever used in this title unless he acquired
his United States citizenship solely by reason of (1) his being a
citizen of such possession of the United States, or (2) his birth
or residence within such possession of the United States.
(c) Certain residents of possessions considered nonresidents not
citizens of the United States
A donor who is a citizen of the United States and a resident of a
possession thereof shall, for purposes of the tax imposed by this
chapter, be considered a "nonresident not a citizen of the United
States" within the meaning of that term wherever used in this
title, but only if such donor acquired his United States
citizenship solely by reason of (1) his being a citizen of such
possession of the United States, or (2) his birth or residence
within such possession of the United States.
(d) Cross references
(1) For increase in basis of property acquired by gift for
gift tax paid, see section 1015(d).
(2) For exclusion of transfers of property outside the United
States by a nonresident who is not a citizen of the United
States, see section 2511(a).
-SOURCE-
(Aug. 16, 1954, ch. 736, 68A Stat. 403; Pub. L. 85-866, title I,
Secs. 43(b), 102(b), Sept. 2, 1958, 72 Stat. 1641, 1674; Pub. L.
86-779, Sec. 4(d), Sept. 14, 1960, 74 Stat. 1000; Pub. L. 89-809,
title I, Sec. 109(a), Nov. 13, 1966, 80 Stat. 1574; Pub. L. 91-614,
title I, Sec. 102(a)(1), Dec. 31, 1970, 84 Stat. 1838; Pub. L.
93-625, Sec. 14(a), Jan. 3, 1975, 88 Stat. 2121; Pub. L. 94-455,
title XIX, Secs. 1902(a)(10), 1906(b)(13)(A), Oct. 4, 1976, 90
Stat. 1805, 1834; Pub. L. 97-34, title IV, Sec. 442(a)(1), Aug. 13,
1981, 95 Stat. 320; Pub. L. 100-647, title III, Sec. 3031(a)(2),
Nov. 10, 1988, 102 Stat. 3635; Pub. L. 101-508, title XI, Sec.
11601(b)(2), Nov. 5, 1990, 104 Stat. 1388-490; Pub. L. 104-191,
title V, Sec. 511(e)(2), (f)(2)(B), Aug. 21, 1996, 110 Stat. 2098,
2100; Pub. L. 105-34, title XVI, Sec. 1602(g)(5), Aug. 5, 1997, 111
Stat. 1095.)
-MISC1-
AMENDMENTS
1997 - Subsec. (a)(3)(C). Pub. L. 105-34 substituted "donor" for
"decedent".
1996 - Subsec. (a)(3). Pub. L. 104-191, Sec. 511(e)(2),
substituted "Exception" for "Exceptions" in heading and amended
text generally. Prior to amendment, text read as follows:
"Paragraph (2) shall not apply in the case of a donor who at any
time after March 8, 1965, and within the 10-year period ending with
the date of transfer lost United States citizenship unless -
"(A) such donor's loss of United States citizenship resulted
from the application of section 301(b), 350, or 355 of the
Immigration and Nationality Act, as amended (8 U.S.C. 1401(b),
1482, or 1487), or
"(B) such loss did not have for one of its principal purposes
the avoidance of taxes under this subtitle or subtitle A."
Subsec. (a)(3)(E). Pub. L. 104-191, Sec. 511(f)(2)(B), added
subpar. (E).
1990 - Subsec. (d)(3). Pub. L. 101-508 struck out par. (3) which
read as follows: "For treatment of certain transfers related to
estate tax valuation freezes as gifts to which this chapter
applies, see section 2036(c)(4)."
1988 - Subsec. (d)(3). Pub. L. 100-647 added par. (3).
1981 - Subsec. (a)(1), (4). Pub. L. 97-34 substituted "calendar
year" for "calendar quarter" wherever appearing.
1976 - Subsec. (a)(1). Pub. L. 94-455 inserted "for each calendar
quarter" after "hereby imposed" and struck out "For the first
calendar quarter of calendar year 1971 and each calendar quarter
thereafter" after "General rule-".
Subsec. (a)(4). Pub. L. 94-455, Sec. 1906(b)(13)(A), struck out
"or his delegate" after "Secretary".
1975 - Subsec. (a)(5). Pub. L. 93-625 added par. (5).
1970 - Subsec. (a)(1). Pub. L. 91-614, Sec. 102(a)(1)(A),
substituted "For the first calendar quarter of the calendar year
1971 and each calendar quarter thereafter" for "For the calendar
year 1955 and each calendar year thereafter" and "during such
calendar quarter" for "during such calendar year".
Subsec. (a)(4). Pub. L. 91-614, Sec. 102(a)(1)(B), substituted
"calendar quarter" for "calendar year".
1966 - Subsec. (a). Pub. L. 89-809 redesignated existing
provisions as par. (1), struck out ", except transfers of
intangible property by a nonresident not a citizen of the United
States and who was not engaged in business in the United States
during such calendar year" after "resident or nonresident", and
added pars. (2) to (4).
1960 - Subsec. (a). Pub. L. 86-779, Sec. 4(d)(2), struck out "who
is" before "not a citizen".
Subsecs. (c), (d). Pub. L. 86-779, Sec. 4(d)(1), added subsec.
(c) and redesignated former subsec. (c) as (d).
1958 - Subsec. (b). Pub. L. 85-866, Sec. 102(b), added subsec.
(b) and redesignated former subsec. (b) as (c).
Subsec. (c). Pub. L. 85-866, Sec. 102(b), redesignated former
subsec. (b) as (c) and Pub. L. 85-866, Sec. 43(b), made the heading
read in the plural, designated existing provisions as par. (2) and
added par. (1).
EFFECTIVE DATE OF 1997 AMENDMENT
Amendment by Pub. L. 105-34 effective as if included in the
provisions of the Health Insurance Portability and Accountability
Act of 1996, Pub. L. 104-191, to which such amendment relates, see
section 1602(i) of Pub. L. 105-34, set out as a note under section
26 of this title.
EFFECTIVE DATE OF 1996 AMENDMENT
Amendment by Pub. L. 104-191 applicable to individuals losing
United States citizenship on or after Feb. 6, 1995, and to
long-term residents of the United States with respect to whom an
event described in section 877(e)(1)(A) or (B) of this title occurs
on or after Feb. 6, 1995, with special rule for certain individuals
who performed an act of expatriation specified in section
1481(a)(1)-(4) of Title 8, Aliens and Nationality, before Feb. 6,
1995, see section 511(g) of Pub. L. 104-191, set out as a note
under section 877 of this title.
EFFECTIVE DATE OF 1990 AMENDMENT
Amendment by Pub. L. 101-508 applicable in the case of property
transferred after Dec. 17, 1987, see section 11601(c) of Pub. L.
101-508, set out as a note under section 2036 of this title.
EFFECTIVE DATE OF 1988 AMENDMENT
Amendment by Pub. L. 100-647 applicable in cases where transfer
referred to in section 2036(c)(1)(B) of this title is on or after
June 21, 1988, see section 3031(h)(2) of Pub. L. 100-647, set out
as a note under section 2036 of this title.
EFFECTIVE DATE OF 1981 AMENDMENT
Section 442(e) of Pub. L. 97-34 provided that: "The amendments
made by this section [amending this section and sections 1015,
2502, 2503, 2504, 2505, 2512, 2513, 2522, 6019, 6075, and 6212 of
this title] shall apply with respect to gifts made after December
31, 1981."
EFFECTIVE DATE OF 1976 AMENDMENT
Section 1902(c)(2) of Pub. L. 94-455, as amended by Pub. L.
95-600, title VII, Sec. 703(j)(12), Nov. 6, 1978, 92 Stat. 2942,
provided that: "The amendments made by paragraphs (10), (11), and
(12)(D) and (E) of subsection (a) [amending this section and
sections 2522 and 2523 of this title] shall apply with respect to
gifts made after December 31, 1976."
EFFECTIVE DATE OF 1975 AMENDMENT
Section 14(b) of Pub. L. 93-625 provided that: "The amendment
made by subsection (a) [amending this section] shall apply to
transfers made after May 7, 1974."
EFFECTIVE DATE OF 1970 AMENDMENT
Section 102(e) of Pub. L. 91-614 provided that: "The amendments
made by this section [amending this section and sections 1015,
2012, 2502, 2503, 2504, 2512, 2513, 2515, 2521, 2522, 2523, 6019,
6075, 6212, 6214, 6324, 6501, and 6512 of this title and enacting
provisions set out as a note under this section] shall apply with
respect to gifts made after December 31, 1970."
EFFECTIVE DATE OF 1966 AMENDMENT
Section 109(c) of Pub. L. 89-809 provided that: "The amendments
made by this section [amending this section and section 2511 of
this title] shall apply with respect to the calendar year 1967 and
all calendar years thereafter."
EFFECTIVE DATE OF 1960 AMENDMENT
Section 4(e)(3) of Pub. L. 86-779 provided that: "The amendments
made by subsection (d) [amending this section] shall apply with
respect to gifts made after the date of the enactment of this Act
[Sept. 14, 1960]."
EFFECTIVE DATE OF 1958 AMENDMENT
Amendment by Pub. L. 85-866 applicable to gifts made after
September 2, 1958, see section 102(d) of Pub. L. 85-866, set out as
a note under section 2011 of this title.
ELECTION TO HAVE AMENDMENTS BY TITLE IV OF THE ECONOMIC RECOVERY
TAX ACT OF 1981 NOT APPLY
Pub. L. 97-448, title I, Sec. 104(d)(3), Jan. 12, 1983, 96 Stat.
2383, as amended by Pub. L. 99-514, Sec. 2, Oct. 22, 1986, 100
Stat. 2095, provided that:
"(A) In the case of any decedent -
"(i) who dies before August 13, 1984, and
"(ii) who made a gift (before August 13, 1981, and during the
3-year period ending on the date of the decedent's death) on
which tax imposed by chapter 12 of the Internal Revenue Code of
1986 [formerly I.R.C. 1954] has been paid before April 16, 1982,
such decedent's executor may make an election to have subtitle B of
such Code (relating to estate and gift taxes) applied with respect
to such decedent without regard to any of the amendments made by
title IV of the Economic Recovery Tax Act of 1981 [Pub. L. 97-34,
title IV].
"(B) An election under subparagraph (A) shall be made at such
time and in such manner as the Secretary of the Treasury or his
delegate shall prescribe.
"(C) An election under subparagraph (A), once made, shall be
irrevocable."
-SECREF-
SECTION REFERRED TO IN OTHER SECTIONS
This section is referred to in sections 305, 351, 877, 2056A,
2502, 2505, 2511, 2523, 2661 of this title.
-End-
-CITE-
26 USC Sec. 2502 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle B - Estate and Gift Taxes
CHAPTER 12 - GIFT TAX
Subchapter A - Determination of Tax Liability
-HEAD-
Sec. 2502. Rate of tax
-STATUTE-
(a) Computation of tax
The tax imposed by section 2501 for each calendar year shall be
an amount equal to the excess of -
(1) a tentative tax, computed under section 2001(c), on the
aggregate sum of the taxable gifts for such calendar year and for
each of the preceding calendar periods, over
(2) a tentative tax, computed under such section, on the
aggregate sum of the taxable gifts for each of the preceding
calendar periods.
(b) Preceding calendar period
Whenever used in this title in connection with the gift tax
imposed by this chapter, the term "preceding calendar period" means
-
(1) calendar years 1932 and 1970 and all calendar years
intervening between calendar year 1932 and calendar year 1970,
(2) the first calendar quarter of calendar year 1971 and all
calendar quarters intervening between such calendar quarter and
the first calendar quarter of calendar year 1982, and
(3) all calendar years after 1981 and before the calendar year
for which the tax is being computed.
For purposes of paragraph (1), the term "calendar year 1932"
includes only that portion of such year after June 6, 1932.
(c) Tax to be paid by donor
The tax imposed by section 2501 shall be paid by the donor.
-SOURCE-
(Aug. 16, 1954, ch. 736, 68A Stat. 403; Pub. L. 91-614, title I,
Sec. 102(a)(2), Dec. 31, 1970, 84 Stat. 1839; Pub. L. 94-455, title
XX, Sec. 2001(b)(1), Oct. 4, 1976, 90 Stat. 1849; Pub. L. 97-34,
title IV, Sec. 442(a)(2), Aug. 13, 1981, 95 Stat. 320; Pub. L.
100-203, title X, Sec. 10401(b)(2)(B), Dec. 22, 1987, 101 Stat.
1330-431; Pub. L. 107-16, title V, Sec. 511(d), June 7, 2001, 115
Stat. 70.)
-STATAMEND-
AMENDMENT OF SUBSECTION (A)
Pub. L. 107-16, title V, Sec. 511(d), (f)(3), title IX, Sec. 901,
June 7, 2001, 115 Stat. 70, 71, 150, provided that, applicable to
gifts made after Dec. 31, 2009, subsection (a) of this section is
temporarily amended to read as follows:
(a) Computation of tax
(1) In general
The tax imposed by section 2501 for each calendar year shall be
an amount equal to the excess of -
(A) a tentative tax, computed under paragraph (2), on the
aggregate sum of the taxable gifts for such calendar year and
for each of the preceding calendar periods, over
(B) a tentative tax, computed under paragraph (2), on the
aggregate sum of the taxable gifts for each of the preceding
calendar periods.
(2) Rate schedule
If the amount with The tentative tax is:
respect to which the
tentative tax to be
computed is:
--------------------------------------------------------------------
Not over $10,000 18% of such amount.
Over $10,000 but not over $1,800, plus 20% of the excess over
$20,000 $10,000.
Over $20,000 but not over $3,800, plus 22% of the excess over
$40,000 $20,000.
Over $40,000 but not over $8,200, plus 24% of the excess over
$60,000 $40,000.
Over $60,000 but not over $13,000, plus 26% of the excess
$80,000 over $60,000.
Over $80,000 but not over $18,200, plus 28% of the excess
$100,000 over $80,000.
Over $100,000 but not over $23,800, plus 30% of the excess
$150,000 over $100,000.
Over $150,000 but not over $38,800, plus 32% of the excess
$250,000 over $150,000.
Over $250,000 but not over $70,800, plus 34% of the excess
$500,000 over $250,000.
Over $500,000 $155,800, plus 35% of the excess
over $500,000.
--------------------------------------------------------------------
See Effective and Termination Dates of 2001 Amendment note below.
-MISC1-
AMENDMENTS
1987 - Subsec. (a)(1). Pub. L. 100-203, Sec. 10401(b)(2)(B)(i),
substituted "under section 2001(c)" for "in accordance with the
rate schedule set forth in section 2001(c)".
Subsec. (a)(2). Pub. L. 100-203, Sec. 10401(b)(2)(B)(ii),
substituted "under such section" for "in accordance with such rate
schedule".
1981 - Subsec. (a). Pub. L. 97-34 substituted in introductory
text and par. (1) "calendar year" for "calendar quarter" and in
pars. (1) and (2) "calendar periods" for "calendar years and
calendar quarters".
Subsec. (b). Pub. L. 97-34 substituted definition of "preceding
calendar period" for "calendar quarter", the latter including only
the first calendar quarter of the calendar year 1971 and succeeding
calendar quarters (covered in par. (2)), the former incorporating
former subsec. (c)(1) definition of "preceding calendar years" as
meaning calendar years 1932 and 1970 and all calendar years
intervening between calendar year 1932 and calendar year 1970 and
"calendar year 1932" as including only the portion of such year
after June 6, 1932, and former subsec. (c)(2) definition of
"preceding calendar quarters" as meaning the first calendar quarter
of calendar year 1971 and all calendar quarters intervening between
such calendar quarter and the calendar quarter for which the tax is
being computed.
Subsecs. (c), (d). Pub. L. 97-34 redesignated subsec. (d) as (c).
Former subsec. (c), defining "preceding calendar years" and
"preceding calendar quarters", was incorporated in subsec. (b).
1976 - Subsec. (a). Pub. L. 94-455 inserted "tentative" after
"(1) a" and "(2) a" and substituted in par. (1) "section 2001(c)"
for "this subsection" after "set forth in".
1970 - Subsec. (a). Pub. L. 91-614, Sec. 102(a)(2)(A),
substituted a computation of tax formula based on the current
calendar quarter, preceding calendar quarters, and preceding
calendar years for a formula based entirely on the current and
preceding calendar years.
Subsec. (b). Pub. L. 91-614, Sec. 102(a)(2)(B), substituted
definition of "calendar quarter" for definition of "calendar year".
Subsec. (c). Pub. L. 91-614, Sec. 102(a)(2)(B), substituted
definition of "preceding calendar years and quarters" for
definition of "preceding calendar years".
EFFECTIVE AND TERMINATION DATES OF 2001 AMENDMENT
Pub. L. 107-16, title V, Sec. 511(f)(3), June 7, 2001, 115 Stat.
71, provided that: "The amendments made by subsections (d) and (e)
[amending this section and section 2511 of this title] shall apply
to gifts made after December 31, 2009."
Amendment by Pub. L. 107-16 inapplicable to estates of decedents
dying, gifts made, or generation skipping transfers, after Dec. 31,
2010, and the Internal Revenue Code of 1986 to be applied and
administered to such estates, gifts, and transfers as if such
amendment had never been enacted, see section 901 of Pub. L.
107-16, set out as a note under section 1 of this title.
EFFECTIVE DATE OF 1987 AMENDMENT
Amendment by Pub. L. 100-203 applicable in the case of decedents
dying, and gifts made, after Dec. 31, 1987, see section 10401(c) of
Pub. L. 100-203, set out as a note under section 2001 of this
title.
EFFECTIVE DATE OF 1981 AMENDMENT
Amendment by Pub. L. 97-34 applicable with respect to gifts made
after Dec. 31, 1981, see section 442(e) of Pub. L. 97-34, set out
as a note under section 2501 of this title.
EFFECTIVE DATE OF 1976 AMENDMENT
Section 2001(d)(2) of Pub. L. 94-455 provided that: "The
amendments made by subsections (b) and (c)(2) [enacting section
2505 of this title, amending this section and section 2504 of this
title, and repealing section 2521 of this title] shall apply to
gifts made after December 31, 1976."
EFFECTIVE DATE OF 1970 AMENDMENT
Amendment by Pub. L. 91-614 applicable with respect to gifts made
after Dec. 31, 1970, see section 102(e) of Pub. L. 91-614, set out
as a note under section 2501 of this title.
-SECREF-
SECTION REFERRED TO IN OTHER SECTIONS
This section is referred to in sections 2001, 2501, 2504, 2505 of
this title.
-End-
-CITE-
26 USC Sec. 2503 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle B - Estate and Gift Taxes
CHAPTER 12 - GIFT TAX
Subchapter A - Determination of Tax Liability
-HEAD-
Sec. 2503. Taxable gifts
-STATUTE-
(a) General definition
The term "taxable gifts" means the total amount of gifts made
during the calendar year, less the deductions provided in
subchapter C (section 2522 and following).
(b) Exclusions from gifts
(1) In general
In the case of gifts (other than gifts of future interests in
property) made to any person by the donor during the calendar
year, the first $10,000 of such gifts to such person shall not,
for purposes of subsection (a), be included in the total amount
of gifts made during such year. Where there has been a transfer
to any person of a present interest in property, the possibility
that such interest may be diminished by the exercise of a power
shall be disregarded in applying this subsection, if no part of
such interest will at any time pass to any other person.
(2) Inflation adjustment
In the case of gifts made in a calendar year after 1998, the
$10,000 amount contained in paragraph (1) shall be increased by
an amount equal to -
(A) $10,000, multiplied by
(B) the cost-of-living adjustment determined under section
1(f)(3) for such calendar year by substituting "calendar year
1997" for "calendar year 1992" in subparagraph (B) thereof.
If any amount as adjusted under the preceding sentence is not a
multiple of $1,000, such amount shall be rounded to the next
lowest multiple of $1,000.
(c) Transfer for the benefit of minor
No part of a gift to an individual who has not attained the age
of 21 years on the date of such transfer shall be considered a gift
of a future interest in property for purposes of subsection (b) if
the property and the income therefrom -
(1) may be expended by, or for the benefit of, the donee before
his attaining the age of 21 years, and
(2) will to the extent not so expended -
(A) pass to the donee on his attaining the age of 21 years,
and
(B) in the event the donee dies before attaining the age of
21 years, be payable to the estate of the donee or as he may
appoint under a general power of appointment as defined in
section 2514(c).
[(d) Repealed. Pub. L. 97-34, title III, Sec. 311(h)(5), Aug. 13,
1981, 95 Stat. 282]
(e) Exclusion for certain transfers for educational expenses or
medical expenses
(1) In general
Any qualified transfer shall not be treated as a transfer of
property by gift for purposes of this chapter.
(2) Qualified transfer
For purposes of this subsection, the term "qualified transfer"
means any amount paid on behalf of an individual -
(A) as tuition to an educational organization described in
section 170(b)(1)(A)(ii) for the education or training of such
individual, or
(B) to any person who provides medical care (as defined in
section 213(d)) with respect to such individual as payment for
such medical care.
(f) Waiver of certain pension rights
If any individual waives, before the death of a participant, any
survivor benefit, or right to such benefit, under section
401(a)(11) or 417, such waiver shall not be treated as a transfer
of property by gift for purposes of this chapter.
(g) Treatment of certain loans of artworks
(1) In general
For purposes of this subtitle, any loan of a qualified work of
art shall not be treated as a transfer (and the value of such
qualified work of art shall be determined as if such loan had not
been made) if -
(A) such loan is to an organization described in section
501(c)(3) and exempt from tax under section 501(c) (other than
a private foundation), and
(B) the use of such work by such organization is related to
the purpose or function constituting the basis for its
exemption under section 501.
(2) Definitions
For purposes of this section -
(A) Qualified work of art
The term "qualified work of art" means any archaeological,
historic, or creative tangible personal property.
(B) Private foundation
The term "private foundation" has the meaning given such term
by section 509, except that such term shall not include any
private operating foundation (as defined in section
4942(j)(3)).
-SOURCE-
(Aug. 16, 1954, ch. 736, 68A Stat. 404; Pub. L. 91-614, title I,
Sec. 102(a)(3), Dec. 31, 1970, 84 Stat. 1839; Pub. L. 95-600, title
VII, Sec. 702(j)(2), Nov. 6, 1978, 92 Stat. 2931; Pub. L. 97-34,
title III, Sec. 311(h)(5), title IV, Secs. 441(a), (b), 442(a)(3),
Aug. 13, 1981, 95 Stat. 282, 319, 320; Pub. L. 99-514, title XVIII,
Sec. 1898(h)(1)(B), Oct. 22, 1986, 100 Stat. 2957; Pub. L. 100-647,
title I, Sec. 1018(s)(2)(A), (u)(52), Nov. 10, 1988, 102 Stat.
3586, 3593; Pub. L. 101-239, title VII, Sec. 7811(m)(1), Dec. 19,
1989, 103 Stat. 2412; Pub. L. 105-34, title V, Sec. 501(c), Aug. 5,
1997, 111 Stat. 846.)
-STATAMEND-
ADJUSTMENT OF ANNUAL EXCLUSION FOR GIFTS IN CALENDAR YEAR 2004
For adjustment of dollar amounts of gifts not includible in total
amount of taxable gifts under this section for calendar year 2004,
see section 3.26 of Revenue Procedure 2003-85, set out as a note
under section 1 of this title.
-MISC1-
AMENDMENTS
1997 - Subsec. (b). Pub. L. 105-34 designated existing provisions
as par. (1), inserted par. heading, realigned margins, and added
par. (2).
1989 - Subsecs. (f), (g). Pub. L. 101-239 redesignated subsec.
(f), relating to treatment of certain loans of artworks, as (g).
1988 - Subsec. (e)(2)(B). Pub. L. 100-647, Sec. 1018(u)(52),
substituted "section 213(d)" for "section 213(e)".
Subsec. (f). Pub. L. 100-647, Sec. 1018(s)(2)(A), added subsec.
(f) relating to treatment of certain loans of artworks.
1986 - Subsec. (f). Pub. L. 99-514 added subsec. (f).
1981 - Subsec. (a). Pub. L. 97-34, Sec. 442(a)(3)(A), substituted
"the total amount of gifts made during the calendar year, less the
deductions provided in subchapter C (section 2522 and following)"
for ", in the case of gifts made after December 31, 1970, the total
amount of gifts made during calendar quarter, less the deductions
provided in subchapter C (sec. 2521 and following" and struck out
provision that in the case of gifts made before Jan. 1, 1971,
"taxable gifts" means the total amount of gifts made during the
calendar year, less the deductions provided in subchapter C.
Subsec. (b). Pub. L. 97-34, Sec. 442(a)(3)(B), substituted
provision that in the case of gifts, other than gifts of future
interests in property, made to any person by the donor during the
calendar year, the first $10,000 of such gifts to such person shall
not, for purposes of subsec. (a), be included in the total amount
of gifts made during such year for provision that in computing
taxable gifts for the calendar quarter, in the case of gifts, other
than gifts of future interests in property, made to any person by
the donor during the calendar year 1971 and subsequent calendar
years, $10,000 of such gifts to such person less the aggregate of
the amounts of such gifts to such person during all preceding
calendar quarters of the calendar year shall not, for purposes of
subsec. (a), be included in the total amount of gifts made during
such quarter.
Pub. L. 97-34, Sec. 441(a), substituted "$10,000" for "$3,000".
Subsec. (d). Pub. L. 97-34, Sec. 311(h)(5), repealed subsec. (d)
which related to individual retirement accounts, etc., for spouse.
Subsec. (e). Pub. L. 97-34, Sec. 441(b), added subsec. (e).
1978 - Subsec. (d). Pub. L. 95-600 added subsec. (d).
1970 - Subsec. (a). Pub. L. 91-614, Sec. 102(a)(3)(A), divided
definition of "taxable gifts" into gifts made after Dec. 31, 1970,
where taxable gifts are based on the total amount of gifts made
during the calendar quarter, less the applicable deductions, and
gifts made before Jan. 1, 1971, where taxable gifts are based on
the total amount of gifts made during the calendar year, less the
applicable deductions.
Subsec. (b). Pub. L. 91-614, Sec. 102(a)(3)(B), substituted
provisions with regard to computing taxable gifts for the calendar
quarter, in the case of gifts made to any persons by the donor
during the calendar year 1971 and subsequent calendar years, $3,000
of such gifts to such person less the aggregate of the amounts of
such gifts to such person during all preceding calendar quarters of
the calendar year shall not be included in the total amount of
gifts made during such quarter for provisions requiring in the case
of gifts made to any person by the donor during the calendar year
1955 and subsequent calendar years, the first $3,000 of such gifts
to such person shall not be included in the total amount of gifts
made during such year.
EFFECTIVE DATE OF 1997 AMENDMENT
Amendment by Pub. L. 105-34 applicable to estates of decedents
dying, and gifts made, after Dec. 31, 1997, see section 501(f) of
Pub. L. 105-34, set out as a note under section 2001 of this title.
EFFECTIVE DATE OF 1989 AMENDMENT
Amendment by Pub. L. 101-239 effective, except as otherwise
provided, as if included in the provision of the Technical and
Miscellaneous Revenue Act of 1988, Pub. L. 100-647, to which such
amendment relates, see section 7817 of Pub. L. 101-239, set out as
a note under section 1 of this title.
EFFECTIVE DATE OF 1988 AMENDMENT
Section 1018(s)(2)(B) of Pub. L. 100-647 provided that: "The
amendment made by subparagraph (A) [amending this section] shall
apply to loans after July 31, 1969."
Amendment by section 1018(u)(52) of Pub. L. 100-647 effective,
except as otherwise provided, as if included in the provision of
the Tax Reform Act of 1986, Pub. L. 99-514, to which such amendment
relates, see section 1019(a) of Pub. L. 100-647, set out as a note
under section 1 of this title.
EFFECTIVE DATE OF 1986 AMENDMENT
Amendment by Pub. L. 99-514 effective as if included in the
provision of the Retirement Equity Act of 1984, Pub. L. 98-397, to
which such amendment relates, except as otherwise provided, see
section 1898(j) of Pub. L. 99-514, set out as a note under section
401 of this title.
EFFECTIVE DATE OF 1981 AMENDMENT
Amendment by section 311(h)(5) of Pub. L. 97-34 applicable to
taxable years beginning after Dec. 31, 1981, see section 311(i)(1)
of Pub. L. 97-34, set out as a note under section 219 of this
title.
Section 441(c) of Pub. L. 97-34, as amended by Pub. L. 99-514,
Sec. 2, Oct. 22, 1986, 100 Stat. 2095, provided that:
"(1) In general. - Except as provided in paragraph (2), the
amendments made by this section [amending this section] shall apply
to transfers after December 31, 1981.
"(2) Transitional rule. - If -
"(A) an instrument executed before the date which is 30 days
after the date of the enactment of this Act [Aug. 13, 1981]
provides for a power of appointment which may be exercised during
any period after December 31, 1981,
"(B) such power of appointment is expressly defined in terms
of, or by reference to, the amount of the gift tax exclusion
under section 2503(b) of the Internal Revenue Code of 1986
[formerly I.R.C. 1954] (or the corresponding provision of prior
law),
"(C) the instrument described in subparagraph (A) has not been
amended on or after the date which is 30 days after the date of
the enactment of this Act [Aug. 13, 1981], and
"(D) the State has not enacted a statute applicable to such
gift under which such power of appointment is to be construed as
being defined in terms of, or by reference to, the amount of the
exclusion under such section 2503(b) after its amendment by
subsection (a),
then the amendment made by subsection (a) shall not apply to such
gift."
Amendment by section 442(a)(3) of Pub. L. 97-34 applicable with
respect to gifts made after Dec. 31, 1981, see section 442(e) of
Pub. L. 97-34, set out as a note under section 2501 of this title.
EFFECTIVE DATE OF 1978 AMENDMENT
Section 702(j)(3)(B) of Pub. L. 95-600 provided that: "The
amendment made by paragraph (2) [amending this section] shall apply
to transfers made after December 31, 1976."
EFFECTIVE DATE OF 1970 AMENDMENT
Amendment by Pub. L. 91-614 applicable with respect to gifts made
after Dec. 31, 1970, see section 102(e) of Pub. L. 91-614, set out
as a note under section 2501 of this title.
PLAN AMENDMENTS NOT REQUIRED UNTIL JANUARY 1, 1989
For provisions directing that if any amendments made by subtitle
A or subtitle C of title XI [Secs. 1101-1147 and 1171-1177] or
title XVIII [Secs. 1800-1899A] of Pub. L. 99-514 require an
amendment to any plan, such plan amendment shall not be required to
be made before the first plan year beginning on or after Jan. 1,
1989, see section 1140 of Pub. L. 99-514, as amended, set out as a
note under section 401 of this title.
-SECREF-
SECTION REFERRED TO IN OTHER SECTIONS
This section is referred to in sections 529, 672, 1015, 2001,
2012, 2057, 2101, 2523, 2611, 2632, 2642, 2701, 6019, 6039F, 6501
of this title.
-End-
-CITE-
26 USC Sec. 2504 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle B - Estate and Gift Taxes
CHAPTER 12 - GIFT TAX
Subchapter A - Determination of Tax Liability
-HEAD-
Sec. 2504. Taxable gifts for preceding calendar periods
-STATUTE-
(a) In general
In computing taxable gifts for preceding calendar periods for
purposes of computing the tax for any calendar year -
(1) there shall be treated as gifts such transfers as were
considered to be gifts under the gift tax laws applicable to the
calendar period in which the transfers were made,
(2) there shall be allowed such deductions as were provided for
under such laws, and
(3) the specific exemption in the amount (if any) allowable
under section 2521 (as in effect before its repeal by the Tax
Reform Act of 1976) shall be applied in all computations in
respect of preceding calendar periods ending before January 1,
1977, for purposes of computing the tax for any calendar year.
(b) Exclusions from gifts for preceding calendar periods
In the case of gifts made to any person by the donor during
preceding calendar periods, the amount excluded, if any, by the
provisions of gift tax laws applicable to the periods in which the
gifts were made shall not, for purposes of subsection (a), be
included in the total amount of the gifts made during such
preceding calendar periods.
(c) Valuation of gifts
If the time has expired under section 6501 within which a tax may
be assessed under this chapter 12 (or under corresponding
provisions of prior laws) on -
(1) the transfer of property by gift made during a preceding
calendar period (as defined in section 2502(b)); or
(2) an increase in taxable gifts required under section
2701(d),
the value thereof shall, for purposes of computing the tax under
this chapter, be the value as finally determined (within the
meaning of section 2001(f)(2)) for purposes of this chapter.
(d) Net gifts
The term "net gifts" as used in the corresponding provisions of
prior laws shall be read as "taxable gifts" for purposes of this
chapter.
-SOURCE-
(Aug. 16, 1954, ch. 736, 68A Stat. 405; Pub. L. 91-614, title I,
Sec. 102(a)(4)(A), Dec. 31, 1970, 84 Stat. 1839; Pub. L. 94-455,
title XX, Sec. 2001(c)(2)(A), Oct. 4, 1976, 90 Stat. 1853; Pub. L.
97-34, title IV, Sec. 442(a)(4)(A)-(D), Aug. 13, 1981, 95 Stat.
321; Pub. L. 105-34, title V, Sec. 506(d), Aug. 5, 1997, 111 Stat.
856; Pub. L. 105-206, title VI, Sec. 6007(e)(2)(B)[(C)], July 22,
1998, 112 Stat. 810.)
-REFTEXT-
REFERENCES IN TEXT
The Tax Reform Act of 1976, referred to in subsec. (a)(3), is
Pub. L. 94-455, Oct. 4, 1976, 90 Stat. 1520, as amended. Section
2521 of this title was repealed by section 2001(b)(3) of Pub. L.
94-455. For complete classification of this Act to the Code, see
Tables.
-MISC1-
AMENDMENTS
1998 - Subsec. (c). Pub. L. 105-206 substituted "gifts" for
"certain gifts for preceding calendar periods" in heading and
amended text generally. Prior to amendment, text read as follows:
"If the time has expired within which a tax may be assessed under
this chapter or under corresponding provisions of prior laws on the
transfer of property by gift made during a preceding calendar
period, as defined in section 2502(b), the value of such gift made
in such preceding calendar period shall, for purposes of computing
the tax under this chapter for any calendar year, be the value of
such gift which was used in computing the tax for the last
preceding calendar period for which a tax under this chapter or
under corresponding provisions of prior laws was assessed or paid."
1997 - Subsec. (c). Pub. L. 105-34 struck out ", and if a tax
under this chapter or under corresponding provisions of prior laws
has been assessed or paid for such preceding calendar period" after
"as defined in section 2502(b)".
1981 - Pub. L. 97-34, Sec. 442(a)(4)(D), substituted "calendar
periods" for "years and quarters" in section catchline.
Subsec. (a). Pub. L. 97-34, Sec. 442(a)(4)(A), substituted in
introductory text "preceding calendar periods" and "calendar year"
for "preceding calendar years or calendar quarters" and "calendar
quarter", incorporated existing text in provisions designated pars.
(1) to (3), and substituted in par. (1) "calendar period" for
"years or calendar quarters" and in par. (3) "preceding calendar
periods" and "calendar year" for "calendar years or calendar
quarters" and "calendar quarter".
Subsec. (b). Pub. L. 97-34, Sec. 442(a)(4)(B), substituted in
heading "calendar periods" for "years and quarters" and in text
"preceding calendar periods" for "preceding calendar years and
calendar quarters", "the periods" for "the years and calendar
quarters", and "such preceding calendar periods" for "such years
and calendar quarters".
Subsec. (c). Pub. L. 97-34, Sec. 442(a)(4)(C), substituted in
heading "calendar periods" for "calendar years and quarters" and in
text "preceding calendar period" for "preceding calendar year or
calendar quarter" in four places, "any calendar year" for "any
calendar quarter", and "section 2502(b)" for "section 2502(c)".
1976 - Subsec. (a). Pub. L. 94-455 inserted "(as in effect before
its repeal by the Tax Reform Act of 1976)" after "section 2521" and
"ending before January 1, 1977" after "years or calendar quarters"
and substituted "of" for "to previous" after "computations in
respect".
1970 - Pub. L. 91-614 substituted "Taxable gifts for preceding
years and quarters" for "Taxable gifts for preceding years" in
section catchline.
Subsec. (a). Pub. L. 91-614 substituted "In computing taxable
gifts for the preceding calendar years or calendar quarters for the
purpose of computing the tax for any calendar quarter," for "In
computing taxable gifts for the calendar year 1954 and preceding
calendar years for the purpose of computing the tax for the
calendar year 1955 or any calendar year thereafter," provided that
the laws applicable in the calendar quarters as well as the years
in which the transfers in question were made shall apply, and
substituted "previous calendar years or calendar quarters for the
purpose of computing the tax for any calendar year or calendar
quarter" for "the calendar year 1954 and previous calendar years
for the purpose of computing the tax for the calendar year 1955 or
any calendar year thereafter".
Subsec. (b). Pub. L. 91-614 inserted reference to calendar
quarters in heading, substituted "during preceding calendar years
and calendar quarters," for "during the calendar year 1954 and
preceding calendar years," made reference to the amount excluded by
gift tax laws applicable to the calendar quarters as well as years
in which the gifts were made, and substituted "during such years
and calendar quarters" for "during such year".
Subsec. (c). Pub. L. 91-614 inserted reference to calendar
quarters in heading, inserted "or calendar quarter" after "calendar
year" in four places, and substituted "for any calendar quarter,"
for "for the calendar year 1955 and subsequent calendar years,".
Subsec. (d). Pub. L. 91-614 struck out "For years before the
calendar year 1955" from explanation of term "net gifts" as used in
corresponding provisions of prior laws.
EFFECTIVE DATE OF 1998 AMENDMENT
Amendment by Pub. L. 105-206 effective, except as otherwise
provided, as if included in the provisions of the Taxpayer Relief
Act of 1997, Pub. L. 105-34, to which such amendment relates, see
section 6024 of Pub. L. 105-206, set out as a note under section 1
of this title.
EFFECTIVE DATE OF 1997 AMENDMENT
Amendment by Pub. L. 105-34 applicable to gifts made after Aug.
5, 1997, see section 506(e)(1) of Pub. L. 105-34, as amended, set
out as a note under section 2001 of this title.
EFFECTIVE DATE OF 1981 AMENDMENT
Amendment by Pub. L. 97-34 applicable with respect to gifts made
after Dec. 31, 1981, see section 442(e) of Pub. L. 97-34, set out
as a note under section 2501 of this title.
EFFECTIVE DATE OF 1970 AMENDMENT
Amendment by Pub. L. 91-614 applicable with respect to gifts made
after Dec. 31, 1970, see section 102(e) of Pub. L. 91-614, set out
as a note under section 2501 of this title.
-End-
-CITE-
26 USC Sec. 2505 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle B - Estate and Gift Taxes
CHAPTER 12 - GIFT TAX
Subchapter A - Determination of Tax Liability
-HEAD-
Sec. 2505. Unified credit against gift tax
-STATUTE-
(a) General rule
In the case of a citizen or resident of the United States, there
shall be allowed as a credit against the tax imposed by section
2501 for each calendar year an amount equal to -
(1) the applicable credit amount in effect under section
2010(c) for such calendar year (determined as if the applicable
exclusion amount were $1,000,000), reduced by
(2) the sum of the amounts allowable as a credit to the
individual under this section for all preceding calendar periods.
(b) Adjustment to credit for certain gifts made before 1977
The amount allowable under subsection (a) shall be reduced by an
amount equal to 20 percent of the aggregate amount allowed as a
specific exemption under section 2521 (as in effect before its
repeal by the Tax Reform Act of 1976) with respect to gifts made by
the individual after September 8, 1976.
(c) Limitation based on amount of tax
The amount of the credit allowed under subsection (a) for any
calendar year shall not exceed the amount of the tax imposed by
section 2501 for such calendar year.
-SOURCE-
(Added Pub. L. 94-455, title XX, Sec. 2001(b)(2), Oct. 4, 1976, 90
Stat. 1849; amended Pub. L. 97-34, title IV, Secs. 401(b),
442(a)(5), Aug. 13, 1981, 95 Stat. 299, 321; Pub. L. 101-508, title
XI, Sec. 11801(a)(40), (c)(19)(B), Nov. 5, 1990, 104 Stat.
1388-521, 1388-528; Pub. L. 105-34, title V, Sec. 501(a)(2), Aug.
5, 1997, 111 Stat. 845; Pub. L. 107-16, title V, Sec. 521(b), June
7, 2001, 115 Stat. 71.)
-STATAMEND-
AMENDMENT OF SECTION
For termination of amendment by section 901 of Pub. L. 107-16,
see Effective and Termination Dates of 2001 Amendment note below.
Pub. L. 107-16, title V, Sec. 521(b)(2), (e)(2), title IX, Sec.
901, June 7, 2001, 115 Stat. 71, 72, 150, provided that, applicable
to gifts made after Dec. 31, 2009, subsection (a)(1) of this
section is temporarily amended to read as follows:
"(1) the amount of the tentative tax which would be determined
under the rate schedule set forth in section 2502(a)(2) if the
amount with respect to which such tentative tax is to be computed
were $1,000,000, reduced by".
-REFTEXT-
REFERENCES IN TEXT
The Tax Reform Act of 1976, referred to in subsec. (b), is Pub.
L. 94-455, Oct. 4, 1976, 90 Stat. 1520, as amended. Section 2521 of
this title was repealed by section 2001(b)(3) of Pub. L. 94-455.
For complete classification of this Act to the Code, see Tables.
-MISC1-
AMENDMENTS
2001 - Subsec. (a)(1). Pub. L. 107-16, Secs. 521(b)(1), 901,
temporarily inserted "(determined as if the applicable exclusion
amount were $1,000,000)" after "calendar year". See Effective and
Termination Dates of 2001 Amendment note below.
1997 - Subsec. (a)(1). Pub. L. 105-34 substituted "the applicable
credit amount in effect under section 2010(c) for such calendar
year" for "$192,800".
1990 - Subsecs. (b) to (d). Pub. L. 101-508 redesignated subsecs.
(c) and (d) as subsecs. (b) and (c), respectively, and struck out
former subsec. (b) which provided for a phase-in of the unified
credit against gift tax.
1981 - Subsec. (a). Pub. L. 97-34, Sec. 442(a)(5)(A), substituted
in provision preceding par. (1) "year" for "quarter", and "periods"
for "quarters" in par. (2).
Subsec. (a)(1). Pub. L. 97-34, Sec. 401(b)(1), substituted
"$192,800" for "$47,000".
Subsec. (b). Pub. L. 97-34, Sec. 401(b)(2), struck out from
heading "$47,000" before "credit", substituted subsec. (a)(1)
substitutions for "$192,800" of amounts of "$62,800", "$79,300",
"$96,300", "$121,800", and "$155,800" in the case of gifts made in
1982, 1983, 1984, 1985, and 1986, respectively, for subsec. (a)(1)
substitutions for "$47,000" of amounts of "$6,000", "$30,000",
"$34,000", "$38,000", and "$42,500" in the case of gifts made after
Dec. 31, 1976, and before July 1, 1977, after June 30, 1977, and
before Jan. 1, 1978; after Dec. 31, 1977, and before Jan. 1, 1979,
after Dec. 31, 1978, and before Jan. 1, 1980, and after Dec. 31,
1979, and before Jan. 1, 1981, respectively.
Subsec. (d). Pub. L. 97-34, Sec. 442(a)(5)(B), substituted "year"
for "quarter" in two places.
EFFECTIVE AND TERMINATION DATES OF 2001 AMENDMENT
Amendment by section 521(b)(1) of Pub. L. 107-16 applicable to
estates of decedents dying, and gifts made, after Dec. 31, 2001,
and amendment by section 521(b)(2) of Pub. L. 107-16 applicable to
gifts made after Dec. 31, 2009, see section 521(e)(1), (2) of Pub.
L. 107-16, set out as a note under section 2010 of this title.
Amendment by Pub. L. 107-16 inapplicable to estates of decedents
dying, gifts made, or generation skipping transfers, after Dec. 31,
2010, and the Internal Revenue Code of 1986 to be applied and
administered to such estates, gifts, and transfers as if such
amendment had never been enacted, see section 901 of Pub. L.
107-16, set out as a note under section 1 of this title.
EFFECTIVE DATE OF 1997 AMENDMENT
Amendment by Pub. L. 105-34 applicable to estates of decedents
dying, and gifts made, after Dec. 31, 1997, see section 501(f) of
Pub. L. 105-34, set out as a note under section 2001 of this title.
EFFECTIVE DATE OF 1981 AMENDMENT
Section 401(c)(2) of Pub. L. 97-34 provided that: "The amendments
made by subsection (b) [amending this section] shall apply to gifts
made after such date [Dec. 31, 1981]."
Amendment by section 442(a)(5) of Pub. L. 97-34 applicable with
respect to gifts made after Dec. 31, 1981, see section 442(e) of
Pub. L. 97-34, set out as a note under section 2501 of this title.
SAVINGS PROVISION
For provisions that nothing in amendment by Pub. L. 101-508 be
construed to affect treatment of certain transactions occurring,
property acquired, or items of income, loss, deduction, or credit
taken into account prior to Nov. 5, 1990, for purposes of
determining liability for tax for periods ending after Nov. 5,
1990, see section 11821(b) of Pub. L. 101-508, set out as a note
under section 29 of this title.
-SECREF-
SECTION REFERRED TO IN OTHER SECTIONS
This section is referred to in sections 2056A, 2102 of this
title.
-End-
-CITE-
26 USC Subchapter B - Transfers 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle B - Estate and Gift Taxes
CHAPTER 12 - GIFT TAX
Subchapter B - Transfers
-HEAD-
SUBCHAPTER B - TRANSFERS
-MISC1-
Sec.
2511. Transfers in general.
2512. Valuation of gifts.
2513. Gift by husband or wife to third party.
2514. Powers of appointment.
2515. Treatment of generation-skipping transfer tax.
[2515A. Repealed.]
2516. Certain property settlements.
[2517. Repealed.]
2518. Disclaimers.
2519. Dispositions of certain life estates.
AMENDMENTS
1986 - Pub. L. 99-514, title XIV, Sec. 1432(d)(2), title XVIII,
Sec. 1852(e)(2)(B), Oct. 22, 1986, 100 Stat. 2730, 2868, added item
2515 and struck out item 2517 "Certain annuities under qualified
plans".
1981 - Pub. L. 97-34, title IV, Sec. 403(c)(3)(C), (d)(3)(B)(ii),
Aug. 13, 1981, 95 Stat. 302, 304, as amended Pub. L. 97-448, title
I, Sec. 104(a)(3)(B), Jan. 12, 1983, 96 Stat. 2380, struck out
items 2515 "Tenancies by the entirety in real property" and 2515A
"Tenancies by the entirety in personal property" and added item
2519.
1978 - Pub. L. 95-600, title VII, Sec. 702(k)(1)(C), Nov. 6,
1978, 92 Stat. 2932, substituted in item 2515 "Tenancies by the
entirety in real property" for "Tenancies by the entirety" and
added item 2515A.
1976 - Pub. L. 94-455, title XX, Sec. 2009(b)(3)(A), Oct. 4,
1976, 90 Stat. 1894, added item 2518.
1958 - Pub. L. 85-866, title I, Sec. 68(b), Sept. 2, 1958, 72
Stat. 1659, added item 2517.
-End-
-CITE-
26 USC Sec. 2511 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle B - Estate and Gift Taxes
CHAPTER 12 - GIFT TAX
Subchapter B - Transfers
-HEAD-
Sec. 2511. Transfers in general
-STATUTE-
(a) Scope
Subject to the limitations contained in this chapter, the tax
imposed by section 2501 shall apply whether the transfer is in
trust or otherwise, whether the gift is direct or indirect, and
whether the property is real or personal, tangible or intangible;
but in the case of a nonresident not a citizen of the United
States, shall apply to a transfer only if the property is situated
within the United States.
(b) Intangible property
For purposes of this chapter, in the case of a nonresident not a
citizen of the United States who is excepted from the application
of section 2501(a)(2) -
(1) shares of stock issued by a domestic corporation, and
(2) debt obligations of -
(A) a United States person, or
(B) the United States, a State or any political subdivision
thereof, or the District of Columbia,
which are owned and held by such nonresident shall be deemed to be
property situated within the United States.
-SOURCE-
(Aug. 16, 1954, ch. 736, 68A Stat. 406; Pub. L. 89-809, title I,
Sec. 109(b), Nov. 13, 1966, 80 Stat. 1575; Pub. L. 107-16, title V,
Sec. 511(e), June 7, 2001, 115 Stat. 71; Pub. L. 107-147, title IV,
Sec. 411(g)(1), Mar. 9, 2002, 116 Stat. 46.)
-STATAMEND-
AMENDMENT OF SECTION
Pub. L. 107-147, title IV, Sec. 411(g)(1), (x), Mar. 9, 2002, 116
Stat. 46, 53, provided that, effective as if included in the
provisions of the Economic Growth and Tax Relief Reconciliation Act
of 2001, Pub. L. 107-16, to which such amendment relates,
subsection (c) of this section is amended by striking "taxable gift
under section 2503," and inserting "transfer of property by gift,".
Pub. L. 107-16, title V, Sec. 511(e), (f)(3), title IX, Sec. 901,
June 7, 2001, 115 Stat. 71, 150, provided that, applicable to gifts
made after Dec. 31, 2009, this section is temporarily amended by
adding at the end the following new subsection:
(c) Treatment of certain transfers in trust
Notwithstanding any other provision of this section and except as
provided in regulations, a transfer in trust shall be treated as a
taxable gift under section 2503, unless the trust is treated as
wholly owned by the donor or the donor's spouse under subpart E of
part I of subchapter J of chapter 1.
See Effective and Termination Dates of 2001 Amendment note below.
-MISC1-
AMENDMENTS
1966 - Subsec. (b). Pub. L. 89-809 inserted reference to
nonresidents who are excepted from the application of section
2501(a)(2) and expanded section to include debt obligations of
United States persons or the United States, a State or any
political subdivision thereof, or the District of Columbia.
EFFECTIVE DATE OF 2002 AMENDMENT
Amendment by Pub. L. 107-147 effective as if included in the
provisions of the Economic Growth and Tax Relief Reconciliation Act
of 2001, Pub. L. 107-16, to which such amendment relates, see
section 411(x) of Pub. L. 107-147, set out as a note under section
25B of this title.
EFFECTIVE AND TERMINATION DATES OF 2001 AMENDMENT
Amendment by Pub. L. 107-16 applicable to gifts made after Dec.
31, 2009, see section 511(f)(3) of Pub. L. 107-16, set out as a
note under section 2502 of this title.
Amendment by Pub. L. 107-16 inapplicable to estates of decedents
dying, gifts made, or generation skipping transfers, after Dec. 31,
2010, and the Internal Revenue Code of 1986 to be applied and
administered to such estates, gifts, and transfers as if such
amendment had never been enacted, see section 901 of Pub. L.
107-16, set out as a note under section 1 of this title.
EFFECTIVE DATE OF 1966 AMENDMENT
Amendment by Pub. L. 89-809 applicable with respect to calendar
year 1967 and all calendar years thereafter, see section 109(c) of
Pub. L. 89-809, set out as a note under section 2501 of this title.
-SECREF-
SECTION REFERRED TO IN OTHER SECTIONS
This section is referred to in sections 2101, 2501 of this title.
-End-
-CITE-
26 USC Sec. 2512 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle B - Estate and Gift Taxes
CHAPTER 12 - GIFT TAX
Subchapter B - Transfers
-HEAD-
Sec. 2512. Valuation of gifts
-STATUTE-
(a) If the gift is made in property, the value thereof at the
date of the gift shall be considered the amount of the gift.
(b) Where property is transferred for less than an adequate and
full consideration in money or money's worth, then the amount by
which the value of the property exceeded the value of the
consideration shall be deemed a gift, and shall be included in
computing the amount of gifts made during the calendar year.
(c) Cross reference
For individual's right to be furnished on request a statement
regarding any valuation made by the Secretary of a gift by that
individual, see section 7517.
-SOURCE-
(Aug. 16, 1954, ch. 736, 68A Stat. 406; Pub. L. 91-614, title I,
Sec. 102(b)(1), Dec. 31, 1970, 84 Stat. 1840; Pub. L. 94-455, title
XX, Sec. 2008(a)(2)(B), Oct. 4, 1976, 90 Stat. 1891; Pub. L. 97-34,
title IV, Sec. 442(b)(1), Aug. 13, 1981, 95 Stat. 322.)
-MISC1-
AMENDMENTS
1981 - Subsec. (b). Pub. L. 97-34 substituted "calendar year" for
"calendar quarters".
1976 - Subsec. (c). Pub. L. 94-455 added subsec. (c).
1970 - Subsec. (b). Pub. L. 91-614 substituted "calendar quarter"
for "calendar year".
EFFECTIVE DATE OF 1981 AMENDMENT
Amendment by Pub. L. 97-34 applicable with respect to gifts made
after Dec. 31, 1981, see section 442(e) of Pub. L. 97-34, set out
as a note under section 2501 of this title.
EFFECTIVE DATE OF 1970 AMENDMENT
Amendment by Pub. L. 91-614 applicable with respect to gifts made
after Dec. 31, 1970, see section 102(e) of Pub. L. 91-614, set out
as a note under section 2501 of this title.
-End-
-CITE-
26 USC Sec. 2513 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle B - Estate and Gift Taxes
CHAPTER 12 - GIFT TAX
Subchapter B - Transfers
-HEAD-
Sec. 2513. Gift by husband or wife to third party
-STATUTE-
(a) Considered as made one-half by each
(1) In general
A gift made by one spouse to any person other than his spouse
shall, for the purposes of this chapter, be considered as made
one-half by him and one-half by his spouse, but only if at the
time of the gift each spouse is a citizen or resident of the
United States. This paragraph shall not apply with respect to a
gift by a spouse of an interest in property if he creates in his
spouse a general power of appointment, as defined in section
2514(c), over such interest. For purposes of this section, an
individual shall be considered as the spouse of another
individual only if he is married to such individual at the time
of the gift and does not remarry during the remainder of the
calendar year.
(2) Consent of both spouses
Paragraph (1) shall apply only if both spouses have signified
(under the regulations provided for in subsection (b)) their
consent to the application of paragraph (1) in the case of all
such gifts made during the calendar year by either while married
to the other.
(b) Manner and time of signifying consent
(1) Manner
A consent under this section shall be signified in such manner
as is provided under regulations prescribed by the Secretary.
(2) Time
Such consent may be so signified at any time after the close of
the calendar year in which the gift was made, subject to the
following limitations -
(A) The consent may not be signified after the 15th day of
April following the close of such year, unless before such 15th
day no return has been filed for such year by either spouse, in
which case the consent may not be signified after a return for
such year is filed by either spouse.
(B) The consent may not be signified after a notice of
deficiency with respect to the tax for such year has been sent
to either spouse in accordance with section 6212(a).
(c) Revocation of consent
Revocation of a consent previously signified shall be made in
such manner as in provided under regulations prescribed by the
Secretary, but the right to revoke a consent previously signified
with respect to a calendar year -
(1) shall not exist after the 15th day of April following the
close of such year if the consent was signified on or before such
15th day; and
(2) shall not exist if the consent was not signified until
after such 15th day.
(d) Joint and several liability for tax
If the consent required by subsection (a)(2) is signified with
respect to a gift made in any calendar year, the liability with
respect to the entire tax imposed by this chapter of each spouse
for such year shall be joint and several.
-SOURCE-
(Aug. 16, 1954, ch. 736, 68A Stat. 406; Pub. L. 91-614, title I,
Sec. 102(b)(2), Dec. 31, 1970, 84 Stat. 1840; Pub. L. 94-455, title
XIX, Sec. 1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1834; Pub. L.
97-34, title IV, Sec. 442(b)(2), Aug. 13, 1981, 95 Stat. 322.)
-MISC1-
AMENDMENTS
1981 - Subsec. (a)(1), (2). Pub. L. 97-34, Sec. 442(b)(2)(A),
substituted "calendar year" for "calendar quarter".
Subsec. (b)(2). Pub. L. 97-34, Sec. 442(b)(2)(B)-(D), in
introductory text, substituted "calendar year" for "calendar
quarter", in subpar. (A), substituted "The consent" for "the
consent", "15th day of April following the close of such year" for
"15th day of the second month following the close of such calendar
quarter", and "such year" for "such calendar quarter" in two other
places, and in subpar. (B) substituted "The consent" and "such
year" for "the consent" and "such calendar quarter".
Subsec. (c). Pub. L. 97-34, Sec. 442(b)(2)(E), in provision
preceding par. (1) substituted "calendar year" for "calendar
quarter" and in par. (1) "15th day of April following the close of
such year" for "15th day of the second month following the close of
such quarter".
Subsec. (d). Pub. L. 97-34, Sec. 442(b)(2)(F), substituted "any
calendar year" and "such year" for "any calendar quarter" and "such
calendar quarter".
1976 - Subsecs. (b)(1), (c). Pub. L. 94-455 struck out "or his
delegate" after "Secretary".
1970 - Subsecs. (a), (b)(2). Pub. L. 91-614, Sec. 102(b)(2)(A),
substituted "calendar quarter" for "calendar year".
Subsec. (b)(2)(A). Pub. L. 91-614, Sec. 102(b)(2)(B), substituted
"the 15th day of the second month" for "the 15th day of April" and
substituted "such calendar quarter" for "such year".
Subsec. (b)(2)(B). Pub. L. 91-614, Sec. 102(b)(2)(C), substituted
"such calendar quarter" for "such year".
Subsec. (c). Pub. L. 91-614, Sec. 102(b)(2)(A), substituted
"calendar quarter" for "calendar year".
Subsec. (c)(1). Pub. L. 91-614, Sec. 102(b)(2)(D), substituted
"15th day of the second month following the close of such calendar
quarter" for "15th day of April following the close of such year".
Subsec. (d). Pub. L. 91-614, Sec. 102(b)(2)(A), (E), substituted
"calendar quarter" for "calendar year" and "such calendar quarter"
for "such year".
EFFECTIVE DATE OF 1981 AMENDMENT
Amendment by Pub. L. 97-34 applicable with respect to gifts made
after Dec. 31, 1981, see section 442(e) of Pub. L. 97-34, set out
as a note under section 2501 of this title.
EFFECTIVE DATE OF 1970 AMENDMENT
Amendment by Pub. L. 91-614 applicable with respect to gifts made
after Dec. 31, 1970, see section 102(e) of Pub. L. 91-614, set out
as a note under section 2501 of this title.
-SECREF-
SECTION REFERRED TO IN OTHER SECTIONS
This section is referred to in sections 1015, 2001, 2012, 2642,
2652, 6103 of this title.
-End-
-CITE-
26 USC Sec. 2514 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle B - Estate and Gift Taxes
CHAPTER 12 - GIFT TAX
Subchapter B - Transfers
-HEAD-
Sec. 2514. Powers of appointment
-STATUTE-
(a) Powers created on or before October 21, 1942
An exercise of a general power of appointment created on or
before October 21, 1942, shall be deemed a transfer of property by
the individual possessing such power; but the failure to exercise
such a power or the complete release of such a power shall not be
deemed an exercise thereof. If a general power of appointment
created on or before October 21, 1942, has been partially released
so that it is no longer a general power of appointment, the
subsequent exercise of such power shall not be deemed to be the
exercise of a general power of appointment if -
(1) such partial release occurred before November 1, 1951, or
(2) the donee of such power was under a legal disability to
release such power on October 21, 1942, and such partial release
occurred not later than six months after the termination of such
legal disability.
(b) Powers created after October 21, 1942
The exercise or release of a general power of appointment created
after October 21, 1942, shall be deemed a transfer of property by
the individual possessing such power.
(c) Definition of general power of appointment
For purposes of this section, the term "general power of
appointment" means a power which is exercisable in favor of the
individual possessing the power (hereafter in this subsection
referred to as the "possessor"), his estate, his creditors, or the
creditors of his estate; except that -
(1) A power to consume, invade, or appropriate property for the
benefit of the possessor which is limited by an ascertainable
standard relating to the health, education, support, or
maintenance of the possessor shall not be deemed a general power
of appointment.
(2) A power of appointment created on or before October 21,
1942, which is exercisable by the possessor only in conjunction
with another person shall not be deemed a general power of
appointment.
(3) In the case of a power of appointment created after October
21, 1942, which is exercisable by the possessor only in
conjunction with another person -
(A) if the power is not exercisable by the possessor except
in conjunction with the creator of the power - such power shall
not be deemed a general power of appointment;
(B) if the power is not exercisable by the possessor except
in conjunction with a person having a substantial interest, in
the property subject to the power, which is adverse to exercise
of the power in favor of the possessor - such power shall not
be deemed a general power of appointment. For the purposes of
this subparagraph a person who, after the death of the
possessor, may be possessed of a power of appointment (with
respect to the property subject to the possessor's power) which
he may exercise in his own favor shall be deemed as having an
interest in the property and such interest shall be deemed
adverse to such exercise of the possessor's power;
(C) if (after the application of subparagraphs (A) and (B))
the power is a general power of appointment and is exercisable
in favor of such other person - such power shall be deemed a
general power of appointment only in respect of a fractional
part of the property subject to such power, such part to be
determined by dividing the value of such property by the number
of such persons (including the possessor) in favor of whom such
power is exercisable.
For purposes of subparagraphs (B) and (C), a power shall be
deemed to be exercisable in favor of a person if it is
exercisable in favor of such person, his estate, his creditors,
or the creditors of his estate.
(d) Creation of another power in certain cases
If a power of appointment created after October 21, 1942, is
exercised by creating another power of appointment which, under the
applicable local law, can be validly exercised so as to postpone
the vesting of any estate or interest in the property which was
subject to the first power, or suspend the absolute ownership or
power of alienation of such property, for a period ascertainable
without regard to the date of the creation of the first power, such
exercise of the first power shall, to the extent of the property
subject to the second power, be deemed a transfer of property by
the individual possessing such power.
(e) Lapse of power
The lapse of a power of appointment created after October 21,
1942, during the life of the individual possessing the power shall
be considered a release of such power. The rule of the preceding
sentence shall apply with respect to the lapse of powers during any
calendar year only to the extent that the property which could have
been appointed by exercise of such lapsed powers exceeds in value
the greater of the following amounts:
(1) $5,000, or
(2) 5 percent of the aggregate value of the assets out of
which, or the proceeds of which, the exercise of the lapsed
powers could be satisfied.
(f) Date of creation of power
For purposes of this section a power of appointment created by a
will executed on or before October 21, 1942, shall be considered a
power created on or before such date if the person executing such
will dies before July 1, 1949, without having republished such
will, by codicil or otherwise, after October 21, 1942.
-SOURCE-
(Aug. 16, 1954, ch. 736, 68A Stat. 407; Pub. L. 94-455, title XX,
Sec. 2009(b)(4)(F), Oct. 4, 1976, 90 Stat. 1894.)
-MISC1-
AMENDMENTS
1976 - Subsec. (b). Pub. L. 94-455 struck out "A disclaimer or
renunciation of such a power of appointment shall not be deemed a
release of such power."
EFFECTIVE DATE OF 1976 AMENDMENT
Amendment by Pub. L. 94-455 applicable to transfers creating an
interest in person disclaiming made after Dec. 31, 1976, see
section 2009(e)(2) of Pub. L. 94-455, set out as a note under
section 2518 of this title.
-SECREF-
SECTION REFERRED TO IN OTHER SECTIONS
This section is referred to in sections 2503, 2513 of this title.
-End-
-CITE-
26 USC Sec. 2515 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle B - Estate and Gift Taxes
CHAPTER 12 - GIFT TAX
Subchapter B - Transfers
-HEAD-
Sec. 2515. Treatment of generation-skipping transfer tax
-STATUTE-
In the case of any taxable gift which is a direct skip (within
the meaning of chapter 13), the amount of such gift shall be
increased by the amount of any tax imposed on the transferor under
chapter 13 with respect to such gift.
-SOURCE-
(Added Pub. L. 99-514, title XIV, Sec. 1432(d)(1), Oct. 22, 1986,
100 Stat. 2730.)
-MISC1-
PRIOR PROVISIONS
A prior section, acts Aug. 16, 1954, ch. 736, 68A Stat. 409; Dec.
31, 1970, Pub. L. 91-614, title I, Sec. 102(b)(3), 84 Stat. 1841;
Oct. 4, 1976, Pub. L. 94-455, title XX, Sec. 2002(c)(2), 90 Stat.
1855; Nov. 6, 1978, Pub. L. 95-600, title VII, Sec. 702(k)(1)(B),
92 Stat. 2932, related to tenancies by the entirety in real
property, prior to repeal applicable to gifts made after Dec. 31,
1981, by Pub. L. 97-34, title IV, Sec. 403(c)(3)(B), (e)(2), Aug.
13, 1981, 95 Stat. 302, 305.
EFFECTIVE DATE
Section applicable to generation-skipping transfers (within the
meaning of section 2611 of this title) made after Oct. 22, 1986,
except as otherwise provided, see section 1433 of Pub. L. 99-514,
set out as a note under section 2601 of this title.
-End-
-CITE-
26 USC Sec. 2515A 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle B - Estate and Gift Taxes
CHAPTER 12 - GIFT TAX
Subchapter B - Transfers
-HEAD-
[Sec. 2515A. Repealed. Pub. L. 97-34, title IV, Sec. 403(c)(3)(B),
Aug. 13, 1981, 95 Stat. 302]
-MISC1-
Section, added Pub. L. 95-600, title VII, Sec. 702(k)(1)(A), Nov.
6, 1978, 92 Stat. 2932, related to tenancies by the entirety in
personal property.
EFFECTIVE DATE OF REPEAL
Repeal applicable to gifts made after Dec. 31, 1981, see section
403(e)(2) of Pub. L. 97-34, set out as an Effective Date of 1981
Amendment note under section 2056 of this title.
-End-
-CITE-
26 USC Sec. 2516 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle B - Estate and Gift Taxes
CHAPTER 12 - GIFT TAX
Subchapter B - Transfers
-HEAD-
Sec. 2516. Certain property settlements
-STATUTE-
Where a husband and wife enter into a written agreement relative
to their marital and property rights and divorce occurs within the
3-year period beginning on the date 1 year before such agreement is
entered into (whether or not such agreement is approved by the
divorce decree), any transfers of property or interests in property
made pursuant to such agreement -
(1) to either spouse in settlement of his or her marital or
property rights, or
(2) to provide a reasonable allowance for the support of issue
of the marriage during minority,
shall be deemed to be transfers made for a full and adequate
consideration in money or money's worth.
-SOURCE-
(Aug. 16, 1954, ch. 736, 68A Stat. 409; Pub. L. 98-369, div. A,
title IV, Sec. 425(b), July 18, 1984, 98 Stat. 804.)
-MISC1-
AMENDMENTS
1984 - Pub. L. 98-369 substituted in introductory text "within
the 3-year period beginning on the date 1 year before such
agreement is entered into" for "within 2 years thereafter".
EFFECTIVE DATE OF 1984 AMENDMENT
Section 425(c)(2) of Pub. L. 98-369 provided that: "The amendment
made by subsection (b) [amending this section] shall apply to
transfers after the date of the enactment of this Act [July 18,
1984]."
-SECREF-
SECTION REFERRED TO IN OTHER SECTIONS
This section is referred to in sections 2043, 7701 of this title.
-End-
-CITE-
26 USC Sec. 2517 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle B - Estate and Gift Taxes
CHAPTER 12 - GIFT TAX
Subchapter B - Transfers
-HEAD-
[Sec. 2517. Repealed. Pub. L. 99-514, title XVIII, Sec.
1852(e)(2)(A), Oct. 22, 1986, 100 Stat. 2868]
-MISC1-
Section, added and amended Pub. L. 85-866, title I, Secs. 23(f),
68(a), Sept. 2, 1958, 72 Stat. 1623, 1659; Pub. L. 87-792, Sec.
7(j), Oct. 10, 1962, 76 Stat. 830; Mar. 8, 1966, Pub. L. 89-365,
Sec. 2(b), 80 Stat. 33; Dec. 30, 1969, Pub. L. 91-172, title I,
Sec. 101(j)(24), 83 Stat. 528; Pub. L. 94-455, title XX, Sec.
2009(c) (4), (5), Oct. 4, 1976, 90 Stat. 1895, 1896; Pub. L. 97-34,
title III, Sec. 311(d)(2), Aug. 13, 1981, 95 Stat. 280; Pub. L.
98-369, div. A, title IV, Sec. 491(d)(35), July 18, 1984, 98 Stat.
851, related to the transfers of certain annuities under qualified
plans.
EFFECTIVE DATE OF REPEAL
Repeal applicable to transfers after Oct. 22, 1986, see section
1852(e)(2)(E) of Pub. L. 99-514, set out as an Effective Date of
1986 Amendment note under section 406 of this title.
-End-
-CITE-
26 USC Sec. 2518 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle B - Estate and Gift Taxes
CHAPTER 12 - GIFT TAX
Subchapter B - Transfers
-HEAD-
Sec. 2518. Disclaimers
-STATUTE-
(a) General rule
For purposes of this subtitle, if a person makes a qualified
disclaimer with respect to any interest in property, this subtitle
shall apply with respect to such interest as if the interest had
never been transferred to such person.
(b) Qualified disclaimer defined
For purposes of subsection (a), the term "qualified disclaimer"
means an irrevocable and unqualified refusal by a person to accept
an interest in property but only if -
(1) such refusal is in writing,
(2) such writing is received by the transferor of the interest,
his legal representative, or the holder of the legal title to the
property to which the interest relates not later than the date
which is 9 months after the later of -
(A) the day on which the transfer creating the interest in
such person is made, or
(B) the day on which such person attains age 21,
(3) such person has not accepted the interest or any of its
benefits, and
(4) as a result of such refusal, the interest passes without
any direction on the part of the person making the disclaimer and
passes either -
(A) to the spouse of the decedent, or
(B) to a person other than the person making the disclaimer.
(c) Other rules
For purposes of subsection (a) -
(1) Disclaimer of undivided portion of interest
A disclaimer with respect to an undivided portion of an
interest which meets the requirements of the preceding sentence
shall be treated as a qualified disclaimer of such portion of the
interest.
(2) Powers
A power with respect to property shall be treated as an
interest in such property.
(3) Certain transfers treated as disclaimers
A written transfer of the transferor's entire interest in the
property -
(A) which meets requirements similar to the requirements of
paragraphs (2) and (3) of subsection (b), and
(B) which is to a person or persons who would have received
the property had the transferor made a qualified disclaimer
(within the meaning of subsection (b)),
shall be treated as a qualified disclaimer.
-SOURCE-
(Added Pub. L. 94-455, title XX, Sec. 2009(b)(1), Oct. 4, 1976, 90
Stat. 1893; amended Pub. L. 95-600, title VII, Sec. 702(m)(1), Nov.
6, 1978, 92 Stat. 2935; Pub. L. 97-34, title IV, Sec. 426(a), Aug.
13, 1981, 95 Stat. 318; Pub. L. 97-448, title I, Sec. 104(e), Jan.
12, 1983, 96 Stat. 2384.)
-MISC1-
AMENDMENTS
1983 - Subsec. (c)(3). Pub. L. 97-448 substituted "A written
transfer" for "For purposes of subsection (a), a written transfer".
1981 - Subsec. (c)(3). Pub. L. 97-34 added par. (3).
1978 - Subsec. (b)(4). Pub. L. 95-600 inserted provision relating
to spouse of decedent.
EFFECTIVE DATE OF 1983 AMENDMENT
Amendment by Pub. L. 97-448 effective, except as otherwise
provided, as if it had been included in the provision of the
Economic Recovery Tax Act of 1981, Pub. L. 97-34, to which such
amendment relates, see section 109 of Pub. L. 97-448, set out as a
note under section 1 of this title.
EFFECTIVE DATE OF 1981 AMENDMENT
Section 426(b) of Pub. L. 97-34 provided that: "The amendment
made by subsection (a) [amending this section] shall apply to
transfers creating an interest in the person disclaiming made after
December 31, 1981."
EFFECTIVE DATE OF 1978 AMENDMENT
Section 702(m)(2) of Pub. L. 95-600 provided that: "The amendment
made by paragraph (1) [amending this section] shall apply to
transfers creating an interest in the person disclaiming made after
December 31, 1976."
EFFECTIVE DATE
Section 2009(e)(2) of Pub. L. 94-455 provided that: "The
amendments made by subsection (b) [enacting this section and
section 2046 of this title and amending sections 2041, 2055, 2056,
and 2514 of this title] shall apply with respect to transfers
creating an interest in the person disclaiming made after December
31, 1976."
-SECREF-
SECTION REFERRED TO IN OTHER SECTIONS
This section is referred to in sections 2046, 2654 of this title.
-End-
-CITE-
26 USC Sec. 2519 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle B - Estate and Gift Taxes
CHAPTER 12 - GIFT TAX
Subchapter B - Transfers
-HEAD-
Sec. 2519. Dispositions of certain life estates
-STATUTE-
(a) General rule
For purposes of this chapter and chapter 11, any disposition of
all or part of a qualifying income interest for life in any
property to which this section applies shall be treated as a
transfer of all interests in such property other than the
qualifying income interest.
(b) Property to which this subsection applies
This section applies to any property if a deduction was allowed
with respect to the transfer of such property to the donor -
(1) under section 2056 by reason of subsection (b)(7) thereof,
or
(2) under section 2523 by reason of subsection (f) thereof.
(c) Cross reference
For right of recovery for gift tax in the case of property
treated as transferred under this section, see section
2207A(b).
-SOURCE-
(Added Pub. L. 97-34, title IV, Sec. 403(d)(3)(B)(i), Aug. 13,
1981, 95 Stat. 304; amended Pub. L. 97-448, title I, Sec.
104(a)(3), (7), Jan. 12, 1983, 96 Stat. 2380, 2381.)
-MISC1-
AMENDMENTS
1983 - Pub. L. 97-448, Sec. 104(a)(3)(B), amended directory
language of Pub. L. 97-34, Sec. 403(d)(3)(B)(i), to clarify that
this section be inserted at end of subchapter B of chapter 12,
rather than at end of subchapter B of chapter 11, and did not
involve any change in text.
Subsec. (a). Pub. L. 97-448, Sec. 104(a)(3)(A), substituted "For
purposes of this chapter and chapter 11, any disposition" for "Any
disposition" and "treated as a transfer of all interests in such
property other than the qualifying income interest" for "treated as
a transfer of such property".
Subsec. (c). Pub. L. 97-448, Sec. 104(a)(7), added subsec. (c).
EFFECTIVE DATE OF 1983 AMENDMENT
Amendment by Pub. L. 97-448 effective, except as otherwise
provided, as if it had been included in the provision of the
Economic Recovery Tax Act of 1981, Pub. L. 97-34, to which such
amendment relates, see section 109 of Pub. L. 97-448, set out as a
note under section 1 of this title.
EFFECTIVE DATE
Section applicable to gifts made after Dec. 31, 1981, see section
403(e)(2) of Pub. L. 97-34, set out as an Effective Date of 1981
Amendment note under section 2056 of this title.
-SECREF-
SECTION REFERRED TO IN OTHER SECTIONS
This section is referred to in sections 2044, 2207A, 2523 of this
title.
-End-
-CITE-
26 USC Subchapter C - Deductions 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle B - Estate and Gift Taxes
CHAPTER 12 - GIFT TAX
Subchapter C - Deductions
-HEAD-
SUBCHAPTER C - DEDUCTIONS
-MISC1-
Sec.
[2521. Repealed.]
2522. Charitable and similar gifts.
2523. Gift to spouse.
2524. Extent of deductions.
AMENDMENTS
1976 - Pub. L. 94-455, title XX, Sec. 2001(c)(2)(B)(ii), Oct. 4,
1976, 90 Stat. 1853, struck out item 2521 "Specific exemption".
-SECREF-
SUBCHAPTER REFERRED TO IN OTHER SECTIONS
This subchapter is referred to in section 2503 of this title.
-End-
-CITE-
26 USC Sec. 2521 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle B - Estate and Gift Taxes
CHAPTER 12 - GIFT TAX
Subchapter C - Deductions
-HEAD-
[Sec. 2521. Repealed. Pub. L. 94-455, title XX, Sec. 2001(b)(3),
Oct. 4, 1976, 90 Stat. 1849]
-MISC1-
Section, act Aug. 16, 1954, ch. 736, 68A Stat. 410, allowed a
deduction, in the case of a citizen or resident, an exemption of
$30,000, less amounts claimed and allowed for calendar year 1932
and calendar years intervening between that year and year for which
tax is being computed.
-End-
-CITE-
26 USC Sec. 2522 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle B - Estate and Gift Taxes
CHAPTER 12 - GIFT TAX
Subchapter C - Deductions
-HEAD-
Sec. 2522. Charitable and similar gifts
-STATUTE-
(a) Citizens or residents
In computing taxable gifts for the calendar year, there shall be
allowed as a deduction in the case of a citizen or resident the
amount of all gifts made during such year to or for the use of -
(1) the United States, any State, or any political subdivision
thereof, or the District of Columbia, for exclusively public
purposes;
(2) a corporation, or trust, or community chest, fund, or
foundation, organized and operated exclusively for religious,
charitable, scientific, literary, or educational purposes, or to
foster national or international amateur sports competition (but
only if no part of its activities involve the provision of
athletic facilities or equipment), including the encouragement of
art and the prevention of cruelty to children or animals, no part
of the net earnings of which inures to the benefit of any private
shareholder or individual, which is not disqualified for tax
exemption under section 501(c)(3) by reason of attempting to
influence legislation, and which does not participate in, or
intervene in (including the publishing or distributing of
statements), any political campaign on behalf of (or in
opposition to) any candidate for public office;
(3) a fraternal society, order, or association, operating under
the lodge system, but only if such gifts are to be used
exclusively for religious, charitable, scientific, literary, or
educational purposes, including the encouragement of art and the
prevention of cruelty to children or animals;
(4) posts or organizations of war veterans, or auxiliary units
or societies of any such posts or organizations, if such posts,
organizations, units, or societies are organized in the United
States or any of its possessions, and if no part of their net
earnings insures to the benefit of any private shareholder or
individual.
Rules similar to the rules of section 501(j) shall apply for
purposes of paragraph (2).
(b) Nonresidents
In the case of a nonresident not a citizen of the United States,
there shall be allowed as a deduction the amount of all gifts made
during such year to or for the use of -
(1) the United States, any State, or any political subdivision
thereof, or the District of Columbia, for exclusively public
purposes;
(2) a domestic corporation organized and operated exclusively
for religious, charitable, scientific, literary, or educational
purposes, including the encouragement of art and the prevention
of cruelty to children or animals, no part of the net earnings of
which inures to the benefit of any private shareholder or
individual, which is not disqualified for tax exemption under
section 501(c)(3) by reason of attempting to influence
legislation, and which does not participate in, or intervene in
(including the publishing or distributing of statements), any
political campaign on behalf of (or in opposition to) any
candidate for public office;
(3) a trust, or community chest, fund, or foundation, organized
and operated exclusively for religious, charitable, scientific,
literary, or educational purposes, including the encouragement of
art and the prevention of cruelty to children or animals, no
substantial part of the activities of which is carrying on
propaganda, or otherwise attempting, to influence legislation,
and which does not participate in, or intervene in (including the
publishing or distributing of statements), any political campaign
on behalf of (or in opposition to) any candidate for public
office; but only if such gifts are to be used within the United
States exclusively for such purposes;
(4) a fraternal society, order, or association, operating under
the lodge system, but only if such gifts are to be used within
the United States exclusively for religious, charitable,
scientific, literary, or educational purposes, including the
encouragement of art and the prevention of cruelty to children or
animals;
(5) posts or organizations of war veterans, or auxiliary units
or societies of any such posts or organizations, if such posts,
organizations, units, or societies are organized in the United
States or any of its possessions, and if no part of their net
earnings inures to the benefit of any private shareholder or
individual.
(c) Disallowance of deductions in certain cases
(1) No deduction shall be allowed under this section for a gift
to of (!1) for the use of an organization or trust described in
section 508(d) or 4948(c)(4) subject to the conditions specified in
such sections.
(2) Where a donor transfers an interest in property (other than
an interest described in section 170(f)(3)(B)) to a person, or for
a use, described in subsection (a) or (b) and an interest in the
same property is retained by the donor, or is transferred or has
been transferred (for less than an adequate and full consideration
in money or money's worth) from the donor to a person, or for a
use, not described in subsection (a) or (b), no deduction shall be
allowed under this section for the interest which is, or has been
transferred to the person, or for the use, described in subsection
(a) or (b), unless -
(A) in the case of a remainder interest, such interest is in a
trust which is a charitable remainder annuity trust or a
charitable remainder unitrust (described in section 664) or a
pooled income fund (described in section 642(c)(5)), or
(B) in the case of any other interest, such interest is in the
form of a guaranteed annuity or is a fixed percentage distributed
yearly of the fair market value of the property (to be determined
yearly).
(3) Rules similar to the rules of section 2055(e)(4) shall apply
for purposes of paragraph (2).
(4) Reformations to comply with paragraph (2)
(A) In general
A deduction shall be allowed under subsection (a) in respect
of any qualified reformation (within the meaning of section
2055(e)(3)(B)).
(B) Rules similar to section 2055(e)(3) to apply
For purposes of this paragraph, rules similar to the rules of
section 2055(e)(3) shall apply.
(d) Special rule for irrevocable transfers of easements in real
property
A deduction shall be allowed under subsection (a) in respect of
any transfer of a qualified real property interest (as defined in
section 170(h)(2)(C)) which meets the requirements of section
170(h) (without regard to paragraph (4)(A) thereof).
(e) Cross references
(1) For treatment of certain organizations providing child
care, see section 501(k).
(2) For exemption of certain gifts to or for the benefit of
the United States and for rules of construction with respect to
certain bequests, see section 2055(f).
(3) For treatment of gifts to or for the use of Indian tribal
governments (or their subdivisions), see section 7871.
-SOURCE-
(Aug. 16, 1954, ch. 736, 68A Stat. 410; Pub. L. 85-866, title I,
Sec. 30(d), Sept. 2, 1958, 72 Stat. 1631; Pub. L. 91-172, title II,
Sec. 201(d)(3), (4)(C), (D), Dec. 30, 1969, 83 Stat. 561, 562; Pub.
L. 91-614, title I, Sec. 102(c)(2), Dec. 31, 1970, 84 Stat. 1841;
Pub. L. 94-455, title XII, Secs. 1307(d)(1)(B)(iv), (v),
1313(b)(3), title XIX, Sec. 1902(a)(11), (12)(D), title XXI, Sec.
2124(e)(3), Oct. 4, 1976, 90 Stat. 1727, 1730, 1805, 1806, 1920;
Pub. L. 97-34, title IV, Secs. 423(b), 442(c), Aug. 13, 1981, 95
Stat. 317, 322; Pub. L. 97-248, title II, Sec. 286(b)(3), Sept. 3,
1982, 96 Stat. 570; Pub. L. 97-473, title II, Sec. 202(b)(7), Jan.
14, 1983, 96 Stat. 2610; Pub. L. 98-369, div. A, title X, Secs.
1022(c), 1032(b)(3), July 18, 1984, 98 Stat. 1028, 1034; Pub. L.
99-514, title XIV, Sec. 1422(b), Oct. 22, 1986, 100 Stat. 2717;
Pub. L. 100-203, title X, Sec. 10711(a)(5), (6), Dec. 22, 1987, 101
Stat. 1330-464.)
-MISC1-
AMENDMENTS
1987 - Subsecs. (a)(2), (b)(2), (3). Pub. L. 100-203 inserted
"(or in opposition to)" after "on behalf of".
1986 - Subsecs. (d), (e). Pub. L. 99-514 added subsec. (d) and
redesignated former subsec. (d) as (e).
1984 - Subsec. (c)(4). Pub. L. 98-369, Sec. 1022(c), added par.
(4).
Subsec. (d). Pub. L. 98-369, Sec. 1032(b)(3), added par. (1) and
redesignated former pars. (1) and (2) as (2) and (3), respectively.
1983 - Subsec. (d). Pub. L. 97-473 designated existing provisions
as par. (1), substituted "bequests" for "gifts" second time
appearing in par. (1) as so designated, and added par. (2).
1982 - Subsec. (a). Pub. L. 97-248 inserted provision that rules
similar to rules of section 501(j) apply for purposes of par. (2).
1981 - Subsec. (a). Pub. L. 97-34, Sec. 442(c), substituted
"year" for "quarter" in two places in provision preceding par. (1).
Subsec. (b). Pub. L. 97-34, Sec. 442(c), substituted "year" for
"quarter" in provision preceding par. (1).
Subsec. (c)(3). Pub. L. 97-34, Sec. 423(b), added par. (3).
1976 - Subsec. (a)(1). Pub. L. 94-455, Sec. 1902(a)(12)(D),
struck out "Territory" after "any State".
Subsec. (a)(2). Pub. L. 94-455, Secs. 1307(d)(1)(B)(iv),
1313(b)(3), substituted "which is not disqualified for tax
exemption under section 501(c)(3) by reason of attempting to
influence legislation" for "no substantial part of the activities
of which is carrying on propaganda, or otherwise attempting, to
influence legislation" after "shareholder or individual" and
inserted "or to foster national or international amateur sports
competition (but only if no part of its activities involve the
provision of athletic facilities or equipment)" after "or
educational purposes".
Subsec. (b)(1). Pub. L. 94-455, Sec. 1902(a)(12)(D), struck out
"Territory" after "any State".
Subsec. (b)(2). Pub. L. 94-455, Sec. 1307(d)(1)(B)(v),
substituted "which is not disqualified for tax exemption under
section 501(c)(3) by reason of attempting to influence legislation"
for "no substantial part of the activities of which is carrying on
propaganda, or otherwise attempting, to influence legislation"
after "shareholder or individual".
Subsec. (c)(2). Pub. L. 94-455, Sec. 2124(e)(3), substituted
"(other than an interest described in section 170(f)(3)(B))" for
"(other than a remainder interest in a personal residence or farm
or an undivided portion of the donor's entire interest in
property)" after "an interest in property".
Subsec. (d). Pub. L. 94-455, Sec. 1902(a)(11), substituted
subsec. (d) for former subsec. (d), pars. (1) through (10), which
dealt with cross references to specific exemptions and rules of
construction for gifts to the United States and its
instrumentalities.
1970 - Pub. L. 91-614 substituted "quarter" for "year" in three
places.
1969 - Subsecs. (a)(2), (b)(2), (3). Pub. L. 91-172, Sec.
201(d)(4)(C), (D), inserted non-participation and non-intervention
in political campaigns as an additional qualification.
Subsec. (c). Pub. L. 91-172, Sec. 201(d)(3), substituted
substantive provisions for simple reference to sections 503 and 681
in which such substantive provisions were formerly set out.
1958 - Subsec. (c). Pub. L. 85-866 substituted "503" for "504".
EFFECTIVE DATE OF 1987 AMENDMENT
Amendment by Pub. L. 100-203 applicable with respect to
activities after Dec. 22, 1987, see section 10711(c) of Pub. L.
100-203, set out as a note under section 170 of this title.
EFFECTIVE DATE OF 1986 AMENDMENT
Amendment by Pub. L. 99-514 applicable to transfers and
contributions made after Dec. 31, 1986, see section 1422(e) of Pub.
L. 99-514, set out as a note under section 2055 of this title.
EFFECTIVE DATE OF 1984 AMENDMENT
Amendment by section 1022(c) of Pub. L. 98-369 applicable to
reformations after Dec. 31, 1978, but inapplicable to any
reformation to which section 2055(e)(3) of this title as in effect
before July 18, 1984, applies, see section 1022(e)(1) of Pub. L.
98-369, set out as a note under section 2055 of this title.
Amendment by section 1032(b)(3) of Pub. L. 98-369 applicable to
taxable years beginning after July 18, 1984, see section 1032(c) of
Pub. L. 98-369, set out as a note under section 170 of this title.
EFFECTIVE DATE OF 1983 AMENDMENT
For effective date of amendment by Pub. L. 97-473, see section
204(4) of Pub. L. 97-473, set out as an Effective Date note under
section 7871 of this title.
EFFECTIVE DATE OF 1982 AMENDMENT
Amendment by Pub. L. 97-248 effective Oct. 5, 1976, see section
286(c) of Pub. L. 97-248, set out as a note under section 501 of
this title.
EFFECTIVE DATE OF 1981 AMENDMENT
Section 423(c)(2) of Pub. L. 97-34 provided that: "The amendment
made by subsection (b) [amending this section] shall apply to
transfers after December 31, 1981."
Amendment by section 442(c) of Pub. L. 97-34 applicable with
respect to gifts made after Dec. 31, 1981, see section 442(e) of
Pub. L. 97-34, set out as a note under section 2501 of this title.
EFFECTIVE DATE OF 1976 AMENDMENT
Amendment by section 2124(e)(3) of Pub. L. 94-455 applicable with
respect to contributions or transfers made after June 13, 1976, see
section 2124(e)(4) of Pub. L. 94-455, set out as a note under
section 170 of this title.
EFFECTIVE DATE OF 1970 AMENDMENT
Amendment by Pub. L. 91-614 applicable with respect to gifts made
after Dec. 31, 1970, see section 102(e) of Pub. L. 91-614, set out
as a note under section 2501 of this title.
EFFECTIVE DATE OF 1969 AMENDMENT
Amendment by section 201(d)(3) of Pub. L. 91-172 applicable to
gifts made after Dec. 31, 1969, except that the amendment of par.
(2) of subsec. (c) applicable to gifts made after July 31, 1969,
see section 201(g)(4)(D) of Pub. L. 91-172, set out as a note under
section 170 of this title.
Amendment by section 201(d)(4)(C), (D) of Pub. L. 91-172
applicable to gifts and transfers made after Dec. 31, 1969, see
section 201(g)(4)(E) of Pub. L. 91-172, set out as a note under
section 170 of this title.
CHARITABLE LEAD TRUSTS AND CHARITABLE REMAINDER TRUSTS IN CASE OF
INCOME AND GIFT TAXES
For inclusion of provisions comparable to section 2055(e)(3) of
this title in this section, see section 514(b) of Pub. L. 95-600,
set out as a note under section 2055 of this title.
-SECREF-
SECTION REFERRED TO IN OTHER SECTIONS
This section is referred to in sections 170, 501, 508, 1015,
2012, 2503, 2632, 2642, 4947, 4948, 6019, 7871 of this title; title
12 section 3051; title 15 section 80a-3; title 16 section 1285;
title 22 section 3307.
-FOOTNOTE-
(!1) So in original. Probably should be "or".
-End-
-CITE-
26 USC Sec. 2523 01/19/04
-EXPCITE-
TITLE 26 - INTERNAL REVENUE CODE
Subtitle B - Estate and Gift Taxes
CHAPTER 12 - GIFT TAX
Subchapter C - Deductions
-HEAD-
Sec. 2523. Gift to spouse
-STATUTE-
(a) Allowance of deduction
Where a donor transfers during the calendar year by gift an
interest in property to a donee who at the time of the gift is the
donor's spouse, there shall be allowed as a deduction in computing
taxable gifts for the calendar year an amount with respect to such
interest equal to its value.
(b) Life estate or other terminable interest
Where, on the lapse of time, on the occurrence of an event or
contingency, or on the failure of an event or contingency to occur,
such interest transferred to the spouse will terminate or fail, no
deduction shall be allowed with respect to such interest -
(1) if the donor retains in himself, or transfers or has
transferred (for less than an adequate and full consideration in
money or money's worth) to any person other than such donee
spouse (or the estate of such spouse), an interest in such
property, and if by reason of such retention or transfer the
donor (or his heirs or assigns) or such person (or his heirs or
assigns) may possess or enjoy any part of such property after
such termination or failure of the interest transferred to the
donee spouse; or
(2) if the donor immediately after the transfer to the donee
spouse has a power to appoint an interest in such property which
he can exercise (either alone or in conjunction with any person)
in such manner that the appointee may possess or enjoy any part
of such property after such termination or failure of the
interest transferred to the donee spouse. For purposes of this
paragraph, the donor shall be considered as having immediately
after the transfer to the donee spouse such power to appoint even
though such power cannot be exercised until after the lapse of
time, upon the occurrence of an event or contingency, or on the
failure of an event or contingency to occur.
An exercise or release at any time by the donor, either alone or in
conjunction with any person, of a power to appoint an interest in
property, even though not otherwise a transfer, shall, for purposes
of paragraph (1), be considered as a transfer by him. Except as
provided in subsection (e), where at the time of the transfer it is
impossible to ascertain the particular person or persons who may
receive from the donor an interest in property so transferred by
him, such interest shall, for purposes of paragraph (1), be
considered as transferred to a person other than the donee spouse.
(c) Interest in unidentified assets
Where the assets out of which, or the proceeds of which, the
interest transferred to the donee spouse may be satisfied include a
particular asset or assets with respect to which no deduction would
be allowed if such asset or assets were transferred from the donor
to such spouse, then the value of the interest transferred to such
spouse shall, for purposes of subsection (a), be reduced by the
aggregate value of such particular assets.
(d) Joint interests
If the interest is transferred to the donee spouse as sole joint
tenant with the donor or as tenant by the entirety, the interest of
the donor in the property which exists solely by reason of the
possibility that the donor may survive the donee spouse, or that
there may occur a severance of the tenancy, shall not be considered
for purposes of subsection (b) as an interest retained by the donor
in himself.
(e) Life estate with power of appointment in donee spouse
Where the donor transfers an interest in property, if by such
transfer his spouse is entitled for life to all of the income from
the entire interest, or all the income from a specific portion
thereof, payable annually or at more frequent intervals, with power
in the donee spouse to appoint the entire interest, or such
specific portion (exercisable in favor of such donee spouse, or of
the estate of such donee spouse, or in favor of either, whether or
not in each case the power is exercisable in favor of others), and
with no power in any other person to appoint any part of such
interest, or such portion, to any person other than the donee
spouse -
(1) the interest, or such portion, so transferred shall, for
purposes of subsection (a) be considered as transferred to the
donee spouse, and
(2) no part of the interest, or such portion, so transferred
shall, for purposes of subsection (b)(1), be considered as
retained in the donor or transferred to any person other than the
donee spouse.
This subsection shall apply only if, by such transfer, such power
in the donee spouse to appoint the interest, or such portion,
whether exercisable by will or during life, is exercisable by such
spouse alone and in all events. For purposes of this subsection,
the term "specific portion" only includes a portion determined on a
fractional or percentage basis.
(f) Election with respect to life estate for donee spouse
(1) In general
In the case of qualified terminable interest property -
(A) for purposes of subsection (a), such property shall be
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