- 30 -
circumstances, a decedent's taxable estate may be deemed to
include property that was given away by the decedent before
death. See, e.g., secs. 2036-2038. In this case, however,
respondent has not asserted that any of decedent's lifetime gifts
should be included in decedent's taxable estate.
Accordingly, respondent has not claimed that any of
decedent's $913,200 in investment income should be directly
subject to the estate tax, as part of decedent's taxable estate.
Nevertheless, the determination of the portion of the $913,200
that was transferred by decedent, during her lifetime, to the
children in transactions that constitute "taxable gifts" for gift
tax purposes remains relevant to this case. Under section
2001(b), the amount of decedent's post-1976 "taxable gifts" is
taken into account in the calculation of decedent's estate tax;
the amount of such gifts in part determines the marginal rates of
tax imposed on decedent's taxable estate. See Estate of Smith v.
Commissioner, 94 T.C. 872 (1990).
Our decision concerning the amount of decedent's lifetime
taxable gifts will also determine the amounts to be collected on
the assessments of the related gift tax deficiencies determined
by respondent. Respondent has undertaken to follow the Court's
conclusions in this case in any future collection actions taken
with respect to those deficiencies.
Page: Previous 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 NextLast modified: May 25, 2011