Taxation

Ca. Tax Lawyer Summer 2014, Volume 23, Number 2

Covered Gifts and Bequests: The Need for Guidance (5+ Years Out)

By Patrick W. Martin1

EXECUTIVE SUMMARY

This paper makes some suggestions for guidance under section 2801 of the Internal Revenue Code,2 which has yet to be issued by the Internal Revenue Service ("IRS") and United States Department of the Treasury ("Treasury").

Section 28013 was passed into law in 2008 as part of the "HEART" Act.4 In short, the statutory provision provides that "any United States citizen or resident" who receives "any covered gift or bequest"5 is subject to a tax (currently 40%6) on the value of such gift or bequest.

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