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III. Inclusion in the Gross Estate--Section 2036
A. General Rules
As a general rule, section 2501 imposes a tax for each
calendar year “on the transfer of property by gift” by any
taxpayer, and section 2511(a) further clarifies that such tax
“shall apply whether the transfer is in trust or otherwise,
whether the gift is direct or indirect, and whether the property
is real or personal, tangible or intangible”. For purposes of
determining whether a gift has been made, section 2512(b)
provides: “Where property is transferred for less than an
adequate and full consideration in money or money’s worth, then
the amount by which the value of the property exceeded the value
of the consideration shall be deemed a gift”. The tax is then
computed based upon the statutorily defined “taxable gifts”,
which term is explicated in section 2503. Section 2503(a) states
generally that taxable gifts means the total amount of gifts made
during the calendar year, less specified deductions.
Similarly, the Internal Revenue Code imposes a Federal tax
“on the transfer of the taxable estate of every decedent who is a
citizen or resident of the United States.” Sec. 2001(a). Such
taxable estate, in turn, is defined as “the value of the gross
estate”, less applicable deductions. Sec. 2051. Section 2031(a)
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