Law Commons^™

How Should Inheritance Law Remediate Inequality?, Felix B. Chang

Washington Law Review

This Article argues that trusts and estates (“T&E”) should prioritize intergenerational economic mobility—the ability of children to move beyond the economic stations of their parents—above all other goals. The field’s traditional emphasis on testamentary freedom, or the freedom to distribute property in a will as one sees fit, fosters the stickiness of inequality. For wealthy settlors, dynasty trusts sequester assets from the nation’s system of taxation and stream of commerce. For low-income decedents, intestacy (i.e., the system of property distribution for a person who dies without a will) splinters property rights and inhibits their transfer, especially to nontraditional heirs.

Holistically, …

Lucky For Life: A More Realistic And Reasonable Estate Tax Valuation For Nontransferable Lottery Winnings, Kyla C.E. Grogan

Washington Law Review

When a lottery winner dies after receiving only a few annuity payments from the state, the winner's estate must pay federal estate tax on the balance of the annuity. If the lottery prize is not legally transferable, the winner's estate cannot sell or pledge the right to future payments in order to generate funds to pay the estate tax. The estate tax value of an annuity is generally based on valuation tables that discount the future payments to present value. However, these valuation tables do not control when they produce an unrealistic and unreasonable result. The United States Courts of …

Federal Estate Tax—Valuation Of A Deceased Spouse's Interest In Community Owned Stock—Estate Of Lee V. Commissioner, 69 T.C. 860 (1978), Lisa S. Frye

Washington Law Review

This note questions the propriety of allowing discounts to reflect lack of control where spouses enjoyed joint control over undivided interests in a majority block of shares. The issue is examined in light of existing case law and by reference to Washington community property law and federal estate taxation policies. The note concludes that, although Lee is not contrary to any explicit provision in the Internal Revenue Code, discounting a deceased spouse's share of a community owned majority block neither accurately reflects the degree of control its owners enjoyed nor effectively taxes wealth transfers at death.

Special Estate Tax Valuation Of Farmland And The Emergence Of A Landholding Elite Class, Roland L. Hjorth

Washington Law Review

Examines Internal Revenue Code provisions on farmland as an inheritable asset, including those provisions that offer substantial tax savings.

The Generation-Skipping Loophole: Narrowed, But Not Closed, By The Tax Reform Act Of 1976, Ira Mark Bloom

Washington Law Review

It is the purpose of this article to analyze the operation and effect of this important and complex system of taxation, highlighting the areas in which future reform may be advisable.

Federal Tax Consequences Of Antenuptial Contracts, Patricia Murray

Washington Law Review

This comment will examine the federal gift, estate, and income tax consequences of antenuptial contracts. Each of these taxes will be discussed separately. Antenuptial contracts which provide for the transfer of property arise more frequently in common law property states, where spouses have inchoate rights in one another's property, than in community property states, where the spouses share the community property equally. In the antenuptial contract setting, federal taxes are imposed upon the transfer of property; when an antenuptial contract provides for a transfer of property, there are no differences in the federal tax consequences between common law property and …

Recent Tax Legislation—The Excise, Estate And Gift Tax Adjustment Act Of 1970, John R. Price

Washington Law Review

The Excise, Estate and Gift Tax Adjustment Act of 1970 will result in a temporary increase in the revenue derived from estate and gift taxes, a potentially longer-term increase in excise tax revenues and a permanent decrease in the revenue generated by the minimum tax on items of tax preference income and by the aircraft use tax. More important, it will have an enduring effect on estate, gift and income tax planning and procedures. The origins and principal provisions of the Act will be discussed in the first few pages of this article, after which the provisions relating to the …

Transfer Of Decedent's Basis At Death: The Allocated Carryover Approach, Rodney J. Waldbaum

Washington Law Review

Congressional dissatisfaction with the effects of IRC 1014(a) which, although death is not treated as a taxable event for income tax purposes, grants a stepped-up basis in inherited property resulting in gains tax forgiveness on appreciated property held at death, has prompted suggested legislation aimed at the at-death taxation as capital gains of all appreciation on property held at death. This comment urges, instead, that the decedent's tax basis in non-cash assets should be carried over to his successors and allocated on the basis of the market value of the transferred assets. The required legislation and mechanics for implementation of …

Comparison Of Washington And Federal Gift Taxes, Richard H. Williams

Washington Law Review

Generally, federal gift tax consequences are uppermost in the Washington lawyer's mind when he deals with gift tax problems. Consequently, certain differences in the Washington gift tax law are inadvertently overlooked. Although the Washington Act was patterned after the federal act of 1932, several important areas of difference do exist between the two statutes. The purpose of this comment is to explain portions of the Washington gift tax statute, while comparing and contrasting it with the Internal Revenue Code of 1954. The dearth of cases construing the Washington gift tax statute presents a problem in areas where the statute is …

Federal Estate And State Inheritance Tax Aspects Of The Family Allowance, The Homestead, And The In Lieu Of Homestead Awards, Donna Berg

Washington Law Review

Petitions for setting aside the homestead or for an award in lieu of homestead are relatively common, and the family allowance is often requested. The availability of family support payments as deductions from the decedent's estate for federal estate and state inheritance tax purposes will be considered in this Comment. Their deductibility vel non for Washington State Inheritance Tax purposes is reasonably clear. For Federal Estate Tax purposes, it appears that the homestead or in lieu of homestead award does qualify, but that the family allowance does not qualify, for the marital deduction.

Estate And Gift Taxation Of The Marital Community: Integration Or Disintegration?, Brockman Adams

Washington Law Review

Prior to 1948 it was immediately apparent that any discussion of federal estate and gift taxation had to be divided into the two categories of community property and common law Though an obvious attempt has been made to eliminate the major differences in tax treatment of the two systems, there are still many distinctions which do not meet the eye on a casual reading of the statute. The average practitioner, and for that matter the average "tax lawyer," does not have time to explore the technicalities of the new marital deduction "equalizer" let alone suggest necessary revisions. This article is …

Federal Estate Taxation And The Wiener Case, George Donworth

Washington Law Review

On February 28, 1944, the Supreme Court of the United States by a six to three decision dismissed for want of jurisdiction the case of Flournoy, Sheriff and Ex-Officio Tax Collector of Caddo Parish, Louisiana, against Samuel G. Wiener and others. The majority opinion was written by Chief Justice Stone, and there was a dissenting opinion by Justice Frankfurter in which Justices Roberts and Jackson concurred. The dismissal naturally carries no intimation of the views of the Justices on the merits of the case which involved constitutional points of much importance, especially to property owners in the states where the …

Transfers Intended To Take Effect In Possession Or Enjoyment At Or After Transferor's Death Under The Federal Estate Tax, Alfred Harsch, Max Kaminoff

Washington Law Review

The federal estate tax has, at all times since its adoption in 1916, provided for the inclusion in the gross estate of the decedent of all transfers "intended to take effect in possession or enjoyment at or after death". The purpose of this provision, obviously, is to prevent avoidance of the estate tax through the medium of transfers legally inter vivos which operate in such a manner as to make them fairly satisfactory substitutes for the testamentary dispositions to which the estate tax primarily applies. In describing the types of transfers to be included within the ambit of the provision …