- 29 - to support this theory. Respondent argues that donative intent is not a requirement for a taxable gift, citing section 2512(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. Respondent reasons that since the evidence shows that no consideration was given by Patricia Low for the cancellation of the debt, the amount of the gift must equal the debt, citing section 25.2512-8, Gift Tax Regs. Respondent is correct. The gift tax regulations provide: Transfers reached by the gift tax are not confined to those only which, being without a valuable consideration, accord with the common law concept of gifts, but embrace as well sales, exchanges, and other dispositions of property for a consideration to the extent that the value of the property transferred by the donor exceeds the value in money or money's worth of the consideration given therefore. * * * [Sec. 25.2512-8, Gift Tax Regs.] The Supreme Court has interpreted these provisions as follows: Congress chose not to require an ascertainment of what too often is an elusive state of mind. For purposes of the gift tax it not only dispensed with the test of "donative intent". It formulated a much more workable external test, that where "property is transferred for less than an adequate and full consideration in money or money's worth," the excess in such money value "shall, for the purpose of the tax imposed by this title, be deemed a gift . . ." And Treasury Regulations have emphasized that common law considerations were not embodied in the gift tax. [Commissioner v. Wemyss, 324 U.S. 303, 306-307 (1945) fn. ref. omitted.]Page: Previous 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 Next
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