Federal Income Tax - Gifts and Inheritances

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

29 Pages Posted: 11 Aug 2011 Last revised: 15 Sep 2011

Douglas A. Kahn

University of Michigan Law School

Jeffrey H. Kahn

Florida State University - College of Law

Date Written: August 11, 2011

Abstract

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.

Keywords: Gift, Inheritance, Duberstein, Donor, Donee, Devise, Gift Tax

JEL Classification: H20, H25

Suggested Citation

Kahn, Douglas A. and Kahn, Jeffrey H., Federal Income Tax - Gifts and Inheritances (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. Available at SSRN: https://ssrn.com/abstract=1908383

Douglas A. Kahn (Contact Author)

University of Michigan Law School ( email )

625 South State Street
Ann Arbor, MI 48109-1215
United States
734-647-4043 (Phone)

Jeffrey H. Kahn

Florida State University - College of Law ( email )

425 W. Jefferson Street
Tallahassee, FL 32306
United States
850.644.7474 (Phone)

HOME PAGE: http://www.law.fsu.edu/faculty/jkahn.html

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