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SEC. 2039. ANNUITIES.
(a) General.--The gross estate shall include the
value of an annuity or other payment receivable by any
beneficiary by reason of surviving the decedent under
any form of contract or agreement entered into after
March 3, 1931 (other than as insurance under policies
on the life of the decedent), if, under such contract
or agreement, an annuity or other payment was payable
to the decedent, or the decedent possessed the right to
receive such annuity or payment, either alone or in
conjunction with another for his life or for any period
not ascertainable without reference to his death or for
any period which does not in fact end before his death.
(b) Amount Includible.--Subsection (a) shall apply
to only such part of the value of the annuity or other
payment receivable under such contract or agreement as
is proportionate to that part of the purchase price
therefor contributed by the decedent. * * *
In considering the inclusion of an annuity in the gross
estate, the conflation of sections 2033 and 2039 casts a wide
net. Section 2033 and its predecessors have long been construed
to reach annuities payable to a decedent’s estate upon his or her
death. E.g., Millard v. Maloney, 121 F.2d 257, 259 (3d Cir.
1941); Equitable Trust Co. v. Commissioner, 31 B.T.A. 329, 333-
334 (1934), revd. on another issue sub nom. Commissioner v. Chase
Natl. Bank, 82 F.2d 157 (2d Cir. 1936); Arrington v. United
States, 34 Fed. Cl. 144, 147-148, 150 (1995), affd. without
published opinion 108 F.3d 1393 (Fed. Cir. 1997). Section 2039
was enacted to broaden the reach of the gross estate to draw in
annuities payable to surviving beneficiaries, such as joint and
survivor annuities and annuities to be received by designated
third persons. Gray v. United States, 410 F.2d 1094, 1096-1097
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