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Marital Deduction Formula Clauses After ERTA to Achieve Maximum
Tax Savings”, 57 J. Taxn. 362 (1982). The unusual aspect of this
case is that the surviving spouse executed a disclaimer.
Consequently, the effect of the disclaimer on the computation of
the marital deduction must be considered.
Respondent contends that to give effect to the disclaimer,
the surviving spouse's interest in decedent’s estate must be
reduced by the value of the disclaimed property. Furthermore,
respondent argues that this approach conforms with the intent of
the testator. In his will, the decedent specified that the
amount passing to the surviving spouse shall be determined after
taking into account all credits and deductions allowed to the
estate, including the unified credit and the State death tax
credit. We agree with respondent's position.
Petitioner's argument seems to be based on the language of
the New Mexico statute (see supra note 5) and section 2518, that
the disclaimed property passes from the decedent as if the
disclaiming person had predeceased the testator. Therefore,
petitioner argues, the calculation of the marital deduction must
6(...continued)
to both spouses in their respective estates. Accordingly,
property equal in amount to the credit equivalent will pass to a
beneficiary other than the surviving spouse from the estate of
the first spouse to die and be disposed of tax free by reason of
the unified credit. The remaining property will pass to the
surviving spouse tax free as a result of the marital deduction.
Upon the surviving spouse's death, the property will pass tax
free to the extent of the unified credit amount available to the
surviving spouse.
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