I.R.C. § 2037(a) General Rule
The value of the gross estate shall include the value of all property to the extent
of any interest therein of which the decedent has at any time after September 7,
1916, made a transfer
(except in case of a bona fide sale for an adequate and full consideration in money
or money's worth), by trust or otherwise, if—
I.R.C. § 2037(a)(1)
possession or enjoyment of the property can, through ownership of such interest,
be obtained only by surviving the decedent, and
I.R.C. § 2037(a)(2)
the decedent has retained a reversionary interest in the property (but in the case
of a transfer made before October 8, 1949, only if such reversionary interest arose
by the express terms of the instrument of transfer), and the value of such reversionary
interest immediately before the death of the decedent exceeds 5 percent of the value
of such property.
I.R.C. § 2037(b) Special Rules
For purposes of this section, the term “reversionary interest” includes a possibility
that property transferred by the decedent—
but such term does not include a possibility that the income alone from such property
may return to him or become subject to a power of disposition by him. The value of
a reversionary interest immediately before the death of the decedent shall be determined
(without regard to the fact of the decedent's death) by usual methods of valuation,
including the use of tables of mortality and actuarial principles, under regulations
by the Secretary. In determining the value of a possibility that property may be
subject to a power of disposition by the decedent, such possibility shall be valued
as if it were a possibility that such property may return to the decedent or his
estate. Notwithstanding the foregoing, an interest so transferred shall not be included
in the decedent's gross estate under this section if possession or enjoyment of the
property could have been obtained by any beneficiary during the decedent's life through
the exercise of a general power of appointment
(as defined in section 2041)
which in fact was exercisable immediately before the decedent's death.
(Aug. 16, 1954, ch. 736, 68A Stat. 382; Oct. 16, 1962,
Pub. L. 87-834, 18(a)(2)(E), 76 Stat. 1052; Oct. 4, 1976, Pub. L. 94-455, title XIX, 1906(b)(13)(A), 90 Stat. 1834.)
1976--Subsec. (b). Pub. L. 94-455 struck out “or his delegate” after “Secretary”.
1962--Subsec. (a). Pub. L. 87-834 struck out provisions which excepted real property situated outside of the United
EFFECTIVE DATE OF 1962 AMENDMENT
Amendment by Pub. L. 87-834 applicable, except as otherwise provided, to the estates of decedents dying after
Oct. 16, 1962, see section 18(b) of Pub. L. 87-834, set out as a note under section 2031 of this title.
REINSTATEMENT OF ESTATE TAX; REPEAL OF CARRYOVER BASIS
Section 301 of Pub. L. 111-312 provided:
IN GENERAL.—Each provision of law amended by subtitle A or E of title V of the Economic
Growth and Tax Relief Reconciliation Act of 2001 is amended to read as such provision
would read if such subtitle had never been enacted.
CONFORMING AMENDMENT.—On and after January 1, 2011, paragraph
(1) of section 2505(a) of the Internal Revenue Code of 1986 is amended to read as such paragraph would read if section 521(b)(2) of the
Economic Growth and Tax Relief Reconciliation Act of 2001 had never been enacted.
SPECIAL ELECTION WITH RESPECT TO ESTATES OF DECEDENTS DYING IN 2010.—Notwithstanding
subsection (a), in the case of an estate of a decedent dying after December 31, 2009,
and before January 1, 2011, the executor (within the meaning of section 2203 of the Internal Revenue Code of 1986) may elect to apply such Code as though the amendments made by subsection
(a) do not apply with respect to chapter 11 of such Code and with respect to property
acquired or passing from such decedent (within the meaning of section 1014(b) of such
Code). Such election shall be made at such time and in such manner as the Secretary
of the Treasury or the Secretary's delegate shall provide. Such an election once made
shall be revocable only with the consent of the Secretary of the Treasury or the Secretary's
delegate. For purposes of section 2652(a)(1) of such Code, the determination of whether
any property is subject to the tax imposed by such chapter 11 shall be made without
regard to any election made under this subsection.
EXTENSION OF TIME FOR PERFORMING CERTAIN ACTS.—
(1) ESTATE TAX.—In the case of the estate of a decedent dying after December 31, 2009,
and before the date of the enactment of this Act, the due date for—
filing any return under section 6018 of the Internal Revenue Codeof 1986 (including any election required to be made on such a return) as such section
is in effect after the date of the enactment of this Act without regard to any election
under subsection (c),
making any payment of tax under chapter 11 of such Code, and
making any disclaimer described in section 2518(b) of such Code of an interest in
property passing by reason of the death of such decedent, shall not be earlier than
the date which is 9 months after the date of the enactment of this Act.
GENERATION-SKIPPING TAX.—In the case of any generation-skipping transfer made after
December 31, 2009, and before the date of the enactment of this Act, the due date
for filing any return under section 2662 of the Internal Revenue Code of 1986 (including any election required to be made on such a return)
shall not be earlier than the date which is 9 months after the date of the enactment
of this Act.
EFFECTIVE DATE.—Except as otherwise provided in this section, the amendments made
by this section shall apply to estates of decedents dying, and transfers made, after
December 31, 2009.”
Section 501(a) (Estate Tax Repeal) of Pub. L. 107-16 added Code Sec. 2210, which states that chapter 11 of subtitle B shall not apply
to the estates of decedents dying after December 31, 2009.
Note, however, that Section 901 (Sunset of Provisions of Act) of Pub. L. 107-16, as amended by Pub. L. 107-358 and Pub. L. 111-312, and struck by Pub. L. 112-240, Sec. 101(a)(1) (effective for taxable, plan, or limitation years beginning after Dec. 31, 2012,
and estates of decedents dying, gifts made, or generation skipping transfers after
Dec. 31, 2012), provided that:
IN GENERAL.--All provisions of, and amendments made by, this Act shall not apply--
“(1) to taxable, plan, or limitation years beginning after December 31, 2012, or
“(2) in the case of title V, to estates of decedents dying, gifts made, or generation
skipping transfers, after December 31, 2012.
APPLICATION OF CERTAIN LAWS.--The Internal Revenue Code of 1986 and the Employee Retirement
Income Security Act of 1974 shall be applied and administered to years, estates, gifts,
and transfers described in subsection (a) as if the provisions and amendments described
in subsection (a) had never been enacted.
EXCEPTION.-Subsection (a) shall not apply to section 803 (relating to no federal income
tax on restitution received by victims of the Nazi regime or their heirs or estates).”