- 37 -
not even necessary to identify the donees. Section 25.2511-2(a),
Gift Tax Regs., provides:
Sec. 25.2511-2. Cessation of donor’s dominion and
control.--(a) The gift tax is not imposed upon the
receipt of the property by the donee, nor is it
necessarily determined by the measure of enrichment
resulting to the donee from the transfer, nor is it
conditioned upon ability to identify the donee at the
time of the transfer. On the contrary, the tax is a
primary and personal liability of the donor, is an
excise upon his act of making the transfer, is measured
by the value of the property passing from the donor,
and attaches regardless of the fact that the identity
of the donee may not then be known or ascertainable.
In Robinette v. Helvering, 318 U.S. 184 (1943), the taxpayer
argued that there could be no gift of a remainder interest where
the putative remaindermen (prospective unborn children of the
grantor) did not even exist at the time of the transfer. The
Supreme Court rejected this argument stating that the gift tax is
a primary and personal liability of the donor measured by the
value of the property passing from the donor.
This case involves an attempt by a dying man (or his
attorney) to transfer property to a partnership in consideration
for a 99-percent partnership interest that would be valued at
substantially less than the value of the assets transferred to
the partnership, while at the same time assuring that 100 percent
of the value of the transferred assets would be passed to
decedent’s beneficiaries. Assuming, as the majority has found,
that decedent’s partnership interest was worth less than the
Page: Previous 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 NextLast modified: May 25, 2011