United States Ninth Circuit

In a case in which the IRS determined a deficiency based on the failure of an estate to include gift tax paid by the donee trustees of a Qualifying Terminable Interest in Property (QTIP) trust within three years prior to the decedent's death, the Tax Court's ruling in favor of the IRS is affirmed, where the "gross-up" rule of 26 USC section 2035(b) applied to the gift taxes paid on section 2519 "deemed" transfers, as the taxes were in effect "paid by" the decedent, since the trustees acted as a mere conduit of funds for the decedent, and liability remained with her.

Appellate Information

• Decided 05/03/2012
• Published 05/03/2012

Judges

• Bea

Court

• United States Ninth Circuit

Counsel

• For Appellant:
  
• John W. Porter, Jonathan S. Cohen