Federal Income Tax - Gifts and Inheritances
Douglas A. Kahn
University of Michigan Law School
Jeffrey H. Kahn
Florida State University - College of Law
August 11, 2011
FEDERAL INCOME TAX, 6th Edition, Chapter 6, p. 131, Foundation Press, 2011
U of Michigan Public Law Working Paper No. 246
FSU College of Law, Public Law Research Paper No. 545
The contributed material consists of a chapter on gifts and inheritances from the sixth edition of Federal Income Tax (2011). The chapter discusses the oft-quoted Duberstein standard for determining what is a gift and questions the actual usefulness of that standard. The tax treatment of gifts is examined, and the authors suggest a rationale for the exclusion of gifts from the donee’s income. Exceptions to income exclusion are noted. In connection with considering the exclusion of inheritances from income, attention is given to the treatment of the settlement of an estate controversy. The special treatment of a gift or devise to an employee is examined. The manner for determining the basis of gifted and inherited property is explained, and attention is given to the effect that the payment of a gift tax has on a donee’s basis. Illustrations are provided to help the reader see how the tax rules operate.
Number of Pages in PDF File: 29
Keywords: Gift, Inheritance, Duberstein, Donor, Donee, Devise, Gift Tax
JEL Classification: H20, H25Accepted Paper Series
Date posted: August 11, 2011 ; Last revised: September 15, 2011
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