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Section 691 concerns the taxation of income in respect of a
decedent (IRD). Section 691(a) provides in part:
(1) General rule.--The amount of all items of
gross income in respect of a decedent which are not
properly includible in respect of the taxable period
in which falls the date of his death or a prior period
* * * shall be included in the gross income, for the
taxable year when received, of:
(A) the estate of the decedent, if the right
to receive the amount is acquired by the
decedent’s estate from the decedent;
(B) the person who, by reason of the death of
the decedent, acquires the right to receive the
amount, if the right to receive the amount is not
acquired by the decedent’s estate from the decedent;
or
(C) the person who acquires from the decedent
the right to receive the amount by bequest,
devise, or inheritance, if the amount is received
after a distribution by the decedent’s estate of
such right.
Section 1.691(a)-1(b), Income Tax Regs., provides that
“income in respect of a decedent” refers to those amounts to
which a decedent was entitled as gross income but that were not
properly includable in computing taxable income for the taxable
year ending with the date of death or for a previous taxable year
under the method of accounting employed by the decedent. The
character of an item of IRD to the successor is the same
character as the item would have had in the decedent’s hands
“if the decedent had lived and received such amount.” Sec.
691(a)(3).
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Last modified: May 25, 2011