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Section 2702 provides:
SEC. 2702. SPECIAL VALUATION RULES IN CASE OF
TRANSFERS OF INTERESTS IN TRUSTS.
(a) Valuation Rules.--
(1) In general.--Solely for purposes of
determining--whether a transfer of an interest in
trust to (or for the benefit of) a member of the
transferor’s family is a gift (and the value of
such transfer), the value of any interest in such
trust retained by the transferor or any applicable
family member * * * shall be determined as
provided in paragraph (2).
(2) Valuation of retained interests.--
(A) In general.--The value of any
retained interest which is not a qualified
interest shall be treated as being zero.
(B) Valuation of qualified interest.--
The value of any retained interest which is a
qualified interest shall be determined under
section 7520 [providing for use of valuation
table prescribed by the Secretary for
annuities, life interests, etc.].
* * * * * * *
(b) Qualified Interest.--For purposes of this
section, the term “qualified interest” means--
(1) any interest which consists of the right
to receive fixed amounts payable not less
frequently than annually,
(2) any interest which consists of the right
to receive amounts which are payable not less
frequently than annually and are a fixed
percentage of the fair market value of the
property in the trust (determined annually), and
(3) any noncontingent remainder interest if
all of the other interests in the trust consist of
interests described in paragraph (1) or (2).
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Last modified: May 25, 2011