Source: https://irc.bloombergtax.com/public/uscode/doc/irc/section_2654
Timestamp: 2020-07-04 15:01:45
Document Index: 10507644

Matched Legal Cases: ['§ 2654', '§ 2654', '§ 2654', '§ 2654', '§ 2654', '§ 2654', '§ 2654', '§ 2654', '§ 2654', '§ 2654', '§ 2654']

Internal Revenue Code, § 2654. Special Rules
I.R.C. § 2654(a) Basis Adjustment
I.R.C. § 2654(a)(1) In General —
Except as provided in paragraph (2), if property is transferred in a generation-skipping transfer, the basis of such property shall be increased (but not above the fair market value of such property) by an amount equal to that portion of the tax imposed by section 2601 with respect to the transfer which is attributable to the excess of the fair market value of such property over its adjusted basis immediately before the transfer. The preceding shall be applied after any basis adjustment under section 1015 with respect to the transfer.
I.R.C. § 2654(a)(2) Certain Transfers At Death —
If property is transferred in a taxable termination which occurs at the same time as and as a result of the death of an individual, the basis of such property shall be adjusted in a manner similar to the manner provided under section 1014(a); except that, if the inclusion ratio with respect to such property is less than 1, any increase or decrease in basis shall be limited by multiplying such increase or decrease (as the case may be) by the inclusion ratio.
I.R.C. § 2654(b) Certain Trusts Treated As Separate Trusts —
I.R.C. § 2654(b)(1) —
the portions of a trust attributable to transfers from different transferors shall be treated as separate trusts, and
I.R.C. § 2654(b)(2) —
substantially separate and independent shares of different beneficiaries in a trust shall be treated as separate trusts.
Except as provided in the preceding sentence, nothing in this chapter shall be construed as authorizing a single trust to be treated as 2 or more trusts. For purposes of this subsection, a trust shall be treated as part of an estate during any period that the trust is so treated under section 645.
I.R.C. § 2654(c) Disclaimers —
For provisions relating to the effect of a qualified disclaimer for purposes of this chapter, see section 2518.
I.R.C. § 2654(d) Limitation On Personal Liability Of Trustee —
A trustee shall not be personally liable for any increase in the tax imposed by section 2601 which is attributable to the fact that—
I.R.C. § 2654(d)(1) —
section 2642(c) (relating to exemption of certain nontaxable gifts) does not apply to a transfer to the trust which was made during the life of the transferor and for which a gift tax return was not filed, or
I.R.C. § 2654(d)(2) —
the inclusion ratio with respect to the trust is greater than the amount of such ratio as computed on the basis of the return on which was made (or was deemed made) an allocation of the GST exemption to property transferred to such trust.
The preceding sentence shall not apply if the trustee has knowledge of facts sufficient reasonably to conclude that a gift tax return was required to be filed or that the inclusion ratio was erroneous.
(Added by Pub. L. 99-514, title XIV, Sec. 1431(a), Oct. 22, 1986, 100 Stat. 2727, and amended Pub. L. 100-647, title I, Sec. 1014(g)(12), (13), Nov. 10, 1988, 102 Stat. 3565, 3566; Pub. L. 101-239, title VII, Sec. 7811(j)(2), Dec. 19, 1989, 103 Stat. 2411; Pub. L. 105-206, title VI, Sec. 6013, July 22, 1998, 112 Stat 685; Pub. L. 113-295, Div. A, title II, Sec. 221(a)(95)(B)(iii), Dec. 19, 2014.)
2014 - Subsec. (a)(1). Pub. L. 113-295, Div. A, Sec. 221(a)(95)(B)(iii), amended par. (1) by striking “computed without regard to section 2604)”.
1998 - Subsec. (b). Pub. L. 105-206, Sec. 6013(a)(4)(B), amended subsec. (b) by adding the sentence at the end.
1989 - Subsec. (a)(1). Pub. L. 101-239 inserted at end ‘The preceding shall be applied after any basis adjustment under section 1015 with respect to the transfer.’
1988 - Subsec. (a)(2). Pub. L. 100-647, Sec. 1014(g)(12), inserted ‘or decrease’ after ‘any increase’ and ‘or decrease (as the case may be)’ after ‘such increase’.
Subsec. (b). Pub. L. 100-647, Sec. 1014(g)(13), substituted ‘Certain trusts’ for ‘Separate shares’ in heading and amended text generally. Prior to amendment, text read as follows: ‘Substantially separate and independent shares of different beneficiaries in a trust shall be treated as separate trusts.’
Amendment by Pub. L. 113-295, Div. A, Sec. 221(a)(95)(B)(iii), effective on the date of the enactment of this Act [Enacted: Dec. 19, 2014].
Amendment by Sec. 6013(a)(4)(B) of Pub. L. 105-206 effective as if included in the provisions of the Taxpayer Relief Act of 1997 to which it relates [Effective Date of Pub. L. 105-34, Sec. 1305: estates of decedents dying, and gifts made, after December 31, 1997].