- 5 -
incentive of anticipated benefit” of an economic nature, it
is not a gift. And, conversely, “[w]here the payment is in
return for services rendered, it is irrelevant that the
donor derives no economic benefit from it.” A gift in the
statutory sense, on the other hand, proceeds from a
“detached and disinterested generosity,” “out of affection,
respect, admiration, charity or like impulses.” And in this
regard, the most critical consideration * * * is the
transferor’s “intention.” * * *
* * * The donor’s characterization of his action is not
determinative–-that there must be an objective inquiry as to
whether what is called a gift amounts to it in reality. It
scarcely needs adding that the parties’ expectations or
hopes as to the tax treatment of their conduct * * * [has]
nothing to do with the matter.
* * * The proper criterion * * * is one that inquires
what the basic reason for * * * [the donor’s] conduct was in
fact--the dominant reason that explains his action in making
the transfer. * * * [Fn. refs. and citations omitted.]
Petitioners have the burden of establishing that the amounts
in dispute constituted nontaxable gifts. See Rule 142(a). The
fundamental problem with petitioners’ case is that we have no
evidence as to the dominant reason for the transfers. Instead,
all we have is petitioner’s characterization of the transfers as
gifts, which in itself has little or no evidentiary value.
On the other hand, the evidence that we do have strongly
suggests that the transfers were not gifts within the meaning of
section 102(a). The transfers arose out of petitioner’s
relationship with the members of his congregation presumably
because they believed he was a good minister and they wanted to
reward him. Furthermore, petitioner testified that without the
gifts his activity as a minister was essentially a money losing
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 Next
Last modified: May 25, 2011