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In 1976, subsection (b) of section 2040 was added to the
Code by section 2002(c)(1) of the Tax Reform Act of 1976 (TRA
76), Pub. L. 94-455, 90 Stat. 1520, 1855.6 The 1976 amendment
created a special rule where the joint tenants were husband and
wife. If the interest was a "qualified joint interest",7 only
one-half of the value of the property owned in joint tenancy was
includable in the decedent's gross estate, without regard to
6As enacted in 1976 sec. 2040(b) read:
(b) Certain Joint Interests of Husband and Wife.--
(1) Interests of spouse excluded from gross
estate.-- Notwithstanding subsection (a), in the case
of any qualified joint interest, the value included in
the gross estate with respect to such interest by
reason of this section is one-half of the value of such
qualified joint interest.
(2) Qualified joint interest defined.--For
purposes of paragraph (1), the term "qualified joint
interest" means any interest in property held by the
decedent and the decedent's spouse as joint tenants or
as tenants by the entirety, but only if--
(A) such joint interest was created by the
decedent, the decedent's spouse, or both,
(B)(i) in the case of personal property, the
creation of such joint interest constituted in
whole or in part a gift for purposes of chapter
12, or
(ii) in the case of real property, an
election under section 2515 applies with
respect to the creation of such joint
interest, and
(C) in the case of a joint tenancy, only the
decedent and the decedent's spouse are joint
tenants.
7A "qualified joint interest" was defined as a joint tenancy
between husband and wife, or a tenancy by the entirety, where (1)
such interest was created by the decedent, the decedent's spouse,
or both, and (2) the creation of the joint interest must have
been a gift subject to Federal gift tax.
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Last modified: May 25, 2011