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and 2002. A decedent's gross estate is determined by reference
to part III of chapter 11. Under this part, the value of the
gross estate includes the value of all property to the extent of
the decedent's interest therein on the date of death.5 Sec.
2033.
A decedent's gross estate also includes property that is
subject to section 2036(a), which applies when a decedent makes
an inter vivos transfer of property without adequate and full
consideration and reserves an income interest in the property for
life. Section 2036(a) provides:
General Rule.--The value of the gross estate shall
include the value of all property to the extent of any
interest therein of which the decedent has at any time
made a transfer (except in case of a bona fide sale for
an adequate and full consideration in money or money's
worth), by trust or otherwise, under which he has
retained for his life * * *
(1) the possession or enjoyment of, or the
right to the income from, the property * * *
Respondent argues that section 2036(a) requires that
Decedent's gross estate include the value of 470 shares of Vaparo
preferred stock, less the value of Decedent's annuity.
Respondent argues that the "bona fide sale for adequate and full
consideration" exception of section 2036(a) is inapplicable to
the facts at hand because Decedent received consideration only
5 This valuation is usually made at the time of death. The
executor, however, may elect to value a decedent's property as of
an alternate valuation date, e.g., 6 months after death. Sec.
2032.
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Last modified: May 25, 2011