Cases: Messing v. Commissioner, 48 T.C. 502 (1967)
Final rules 2
(a) General definition The term “taxable gifts” means the total amount of gifts made during the calendar year, less the deductions provided in subchapter C (section 2522 and following).
Amended 1970, 1981
- 1981 Pub. L. 97-34 Pub. L. 97–34, § 442(a)(3)(A), substituted “the total amount of gifts made during the calendar year, less the deductions provided in subchapter C (section 2522 and following)” for “, in the case of gifts made after December 31, 1970, the total amount of gifts made during calendar quarter, less the deductions provided in subchapter C (sec. 2521 and following” and struck out provision that in the case of gifts made before Jan. 1, 1971, “taxable gifts” means the total amount of gifts made during the calendar year, less the deductions provided in subchapter C.
- 1970 Pub. L. 91-614 Pub. L. 91–614, § 102(a)(3)(A), divided definition of “taxable gifts” into gifts made after Dec. 31, 1970, where taxable gifts are based on the total amount of gifts made during the calendar quarter, less the applicable deductions, and gifts made before Jan. 1, 1971, where taxable gifts are based on the total amount of gifts made during the calendar year, less the applicable deductions.
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(b) Exclusions from gifts
Amended 1970, 1981, 1997
- 1997 Pub. L. 105-34 Pub. L. 105–34 designated existing provisions as par. (1), inserted par. heading, realigned margins, and added par. (2).
- 1981 Pub. L. 97-34 Pub. L. 97–34, § 442(a)(3)(B), substituted provision that in the case of gifts, other than gifts of future interests in property, made to any person by the donor during the calendar year, the first $10,000 of such gifts to such person shall not, for purposes of subsec. (a), be included in the total amount of gifts made during such year for provision that in computing taxable gifts for the calendar quarter, in the case of gifts, other than gifts of future interests in property, made to any person by the donor during the calendar year 1971 and subsequent calendar years, $10,000 of such gifts to such person less the aggregate of the amounts of such gifts to such person during all preceding calendar quarters of the calendar year shall not, for purposes of subsec. (a), be included in the total amount of gifts made during such quarter.
- 1981 Pub. L. 97-34 Pub. L. 97–34, § 441(a), substituted “$10,000” for “$3,000”.
- 1970 Pub. L. 91-614 Pub. L. 91–614, § 102(a)(3)(B), substituted provisions with regard to computing taxable gifts for the calendar quarter, in the case of gifts made to any persons by the donor during the calendar year 1971 and subsequent calendar years, $3,000 of such gifts to such person less the aggregate of the amounts of such gifts to such person during all preceding calendar quarters of the calendar year shall not be included in the total amount of gifts made during such quarter for provisions requiring in the case of gifts made to any person by the donor during the calendar year 1955 and subsequent calendar years, the first $3,000 of such gifts to such person shall not be included in the total amount of gifts made during such year.
Cases: Shepherd v. Commissioner, 115 T.C. 376 (2000)
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(1) In general In the case of gifts (other than gifts of future interests in property) made to any person by the donor during the calendar year, the first $10,000 of such gifts to such person shall not, for purposes of subsection (a), be included in the total amount of gifts made during such year. Where there has been a transfer to any person of a present interest in property, the possibility that such interest may be diminished by the exercise of a power shall be disregarded in applying this subsection, if no part of such interest will at any time pass to any other person.
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(2) Inflation adjustment In the case of gifts made in a calendar year after 1998, the $10,000 amount contained in paragraph (1) shall be increased by an amount equal to—
(A) $10,000, multiplied by
(B) the cost-of-living adjustment determined under section 1(f)(3) for such calendar year by substituting “calendar year 1997” for “calendar year 2016” in subparagraph (A)(ii) thereof.
Amended 2017
- 2017 Pub. L. 115-97 Pub. L. 115–97 substituted “for ‘calendar year 2016’ in subparagraph (A)(ii)” for “for ‘calendar year 1992’ in subparagraph (B)”.
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If any amount as adjusted under the preceding sentence is not a multiple of $1,000, such amount shall be rounded to the next lowest multiple of $1,000.
(c) Transfer for the benefit of minor No part of a gift to an individual who has not attained the age of 21 years on the date of such transfer shall be considered a gift of a future interest in property for purposes of subsection (b) if the property and the income therefrom—
Cases: Ross v. United States, 348 F.2d 577 (5th Cir. 1965)
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(1) may be expended by, or for the benefit of, the donee before his attaining the age of 21 years, and
(2) will to the extent not so expended—
(A) pass to the donee on his attaining the age of 21 years, and
(B) in the event the donee dies before attaining the age of 21 years, be payable to the estate of the donee or as he may appoint under a general power of appointment as defined in section 2514(c).
[(d) Repealed. Pub. L. 97–34, title III, § 311(h)(5), Aug. 13, 1981, 95 Stat. 282]
Amended 1978, 1981
- 1981 Pub. L. 97-34 Pub. L. 97–34, § 311(h)(5), repealed subsec. (d) which related to individual retirement accounts, etc., for spouse.
- 1978 Pub. L. 95-600 Pub. L. 95–600 added subsec. (d).
(e) Exclusion for certain transfers for educational expenses or medical expenses
Amended 1981
- 1981 Pub. L. 97-34 Pub. L. 97–34, § 441(b), added subsec. (e).
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(1) In general Any qualified transfer shall not be treated as a transfer of property by gift for purposes of this chapter.
(2) Qualified transfer For purposes of this subsection, the term “qualified transfer” means any amount paid on behalf of an individual—
(A) as tuition to an educational organization described in section 170(b)(1)(A)(ii) for the education or training of such individual, or
(B) to any person who provides medical care (as defined in section 213(d)) with respect to such individual as payment for such medical care.
Amended 1988
- 1988 Pub. L. 100-647 Pub. L. 100–647, § 1018(u)(52), substituted “section 213(d)” for “section 213(e)”.
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(f) Waiver of certain pension rights If any individual waives, before the death of a participant, any survivor benefit, or right to such benefit, under section 401(a)(11) or 417, such waiver shall not be treated as a transfer of property by gift for purposes of this chapter.
Amended 1986, 1988, 1989
- 1989 Pub. L. 101-239 Pub. L. 101–239 redesignated subsec. (f), relating to treatment of certain loans of artworks, as (g).
- 1988 Pub. L. 100-647 Pub. L. 100–647, § 1018(s)(2)(A), added subsec. (f) relating to treatment of certain loans of artworks.
- 1986 Pub. L. 99-514 Pub. L. 99–514 added subsec. (f).
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(g) Treatment of certain loans of artworks
Amended 1989
- 1989 Pub. L. 101-239 Pub. L. 101–239 redesignated subsec. (f), relating to treatment of certain loans of artworks, as (g).
(1) In general For purposes of this subtitle, any loan of a qualified work of art shall not be treated as a transfer (and the value of such qualified work of art shall be determined as if such loan had not been made) if—
(A) such loan is to an organization described in section 501(c)(3) and exempt from tax under section 501(c) (other than a private foundation), and
(B) the use of such work by such organization is related to the purpose or function constituting the basis for its exemption under section 501.
(2) Definitions For purposes of this section—
(A) Qualified work of art The term “qualified work of art” means any archaeological, historic, or creative tangible personal property.
(B) Private foundation The term “private foundation” has the meaning given such term by section 509, except that such term shall not include any private operating foundation (as defined in section 4942(j)(3)).