106 T.C. No. 10
UNITED STATES TAX COURT
ESTATE OF MILADA S. NEUMANN, DECEASED, ERIC W.
SHAW, ANCILLARY ADMINISTRATOR, C.T.A., Petitioner v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 11060-94. Filed April 9, 1996.
Decedent, a nonresident alien, died in 1990. She
bequeathed U.S. situs property outright to her
grandchildren. In 1986, bequests of this type, i.e.,
"direct skips", were first subjected to the generation-
skipping transfer (GST) tax provisions of secs. 2601
through 2663, I.R.C. At the time of decedent's death,
regulations dealing with "direct skips" had not been
issued. Held, the bequests are subject to the GST tax.
The issuance of regulations in respect of "direct
skips" by nonresident aliens provided for in sec.
2663(2), I.R.C., is not a condition precedent to the
imposition of the GST tax on such "direct skips" but
merely authorizes the Secretary to prescribe the
allocations and calculations involved in determining
how such tax should be imposed.
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