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2. Equal Protection
The estate contends that section 2035(c) is unconstitutional
because it violates equal protection requirements of the Fifth
Amendment.14
On its face, section 2035(c) does not differentiate between
any classes of persons (excepting perhaps the living and the
dead). The estate contends, however, that section 2035(c)
nevertheless results in unequal treatment for married persons and
single persons. In support of this argument, the estate focuses
on the following statement of legislative intent with respect to
the enactment of section 2035(c) in the 1976 Act:
The amount of gift tax subject to this rule [i.e., the
gross-up rule] would include tax paid by the decedent
or his estate on any gift made by the decedent or his
spouse after December 31, 1976. It would not, however,
include any gift tax paid by the spouse on a gift made
by the decedent within 3 years of death which is
treated as made one-half by the spouse, since the
spouse’s payment of such tax would not reduce the
decedent’s estate at the time of death. [H. Rept. 98-
1380, supra at 14, 1976-3 C.B. (Vol. 3) at 748.]
The estate contends that the effect of this statement of
legislative intent is that–-
payment of estate tax on gift taxes is avoided if the
person paying the gift tax is the spouse of the donor,
elects gift-splitting with the donor, and lives beyond
three years of when the donor made the gift. The gift-
splitting election referenced by Congress in the
14 The Fifth Amendment, as applied to Federal legislation,
encompasses the equal protection requirements of the Fourteenth
Amendment. Weinberger v. Wiesenfeld, 420 U.S. 636, 638 n.2
(1975); Johnson v. Robison, 415 U.S. 361, 364-365 n.4 (1974).
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