Estate of Anne F. Greco, Deceased, Frederick D. Greco, Co-Administrator - Page 9

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               limitation unless the language or necessary implication                
               of the section involved makes its application dependent                
               on state law.  [United States v. Pelzer, 312 U.S. 399,                 
               402-403 (1941) (refusing to apply Alabama law to                       
               determine whether an interest was a future interest for                
               purposes of section 504(b), the predecessor to section                 
               2035(b))].                                                             
               Thus, we do not need to apply Virginia law to ascertain what           
          precise future interest was held by the grandchildren.  The                 
          annual per donee exclusion is not available for future interests.           
          Sec. 2503(b).  A future interest is any interest or estate,                 
          vested or contingent, limited to commence in possession or                  
          enjoyment at a future date.  United States v. Pelzer, supra.                
          Accordingly, no annual exclusions are available for the future              
          interests in the grandchildren.                                             
               We conclude, for these reasons, that the lifetime gift made            
          by decedent in 1986, with a value of $51,372.50 ($71,372.50 less            
          $20,000 for exclusions pursuant to section 2503(b)), shall be               
          treated as an adjusted taxable gift for purposes of section                 
          2001(b).                                                                    
                                             Decision will be entered                 
                                        under Rule 155.                               














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