§1015 — Basis of property acquired by gifts and transfers in trust
65 cases·7 followed·1 distinguished·2 questioned·1 overruled·54 cited—11% support
Statute Text — 26 U.S.C. §1015
If the property was acquired by gift after December 31, 1920, the basis shall be the same as it would be in the hands of the donor or the last preceding owner by whom it was not acquired by gift, except that if such basis (adjusted for the period before the date of the gift as provided in section 1016) is greater than the fair market value of the property at the time of the gift, then for the purpose of determining loss the basis shall be such fair market value. If the facts necessary to determine the basis in the hands of the donor or the last preceding owner are unknown to the donee, the Secretary shall, if possible, obtain such facts from such donor or last preceding owner, or any other person cognizant thereof. If the Secretary finds it impossible to obtain such facts, the basis in the hands of such donor or last preceding owner shall be the fair market value of such property as found by the Secretary as of the date or approximate date at which, according to the best information that the Secretary is able to obtain, such property was acquired by such donor or last preceding owner.
If the property was acquired after December 31, 1920, by a transfer in trust (other than by a transfer in trust by a gift, bequest, or devise), the basis shall be the same as it would be in the hands of the grantor increased in the amount of gain or decreased in the amount of loss recognized to the grantor on such transfer under the law applicable to the year in which the transfer was made.
If the property was acquired by gift or transfer in trust on or before December 31, 1920, the basis shall be the fair market value of such property at the time of such acquisition.
If—
the property is acquired by gift on or after
September 2, 1958
, the basis shall be the basis determined under subsection (a), increased (but not above the fair market value of the property at the time of the gift) by the amount of gift tax paid with respect to such gift, or
the property was acquired by gift before
September 2, 1958
, and has not been sold, exchanged, or otherwise disposed of before such date, the basis of the property shall be increased on such date by the amount of gift tax paid with respect to such gift, but such increase shall not exceed an amount equal to the amount by which the fair market value of the property at the time of the gift exceeded the basis of the property in the hands of the donor at the time of the gift.
For purposes of paragraph (1), the amount of gift tax paid with respect to any gift is an amount which bears the same ratio to the amount of gift tax paid under chapter 12 with respect to all gifts made by the donor for the calendar year (or preceding calendar period) in which such gift is made as the amount of such gift bears to the taxable gifts (as defined in section 2503(a) but computed without the deduction allowed by section 2521) made by the donor during such calendar year or period. For purposes of the preceding sentence, the amount of any gift shall be the amount included with respect to such gift in determining (for the purposes of section 2503(a)) the total amount of gifts made during the calendar year or period, reduced by the amount of any deduction allowed with respect to such gift under section 2522 (relating to charitable deduction) or under section 2523 (relating to marital deduction).
For purposes of paragraph (1), where the donor and his spouse elected, under section 2513 to have the gift considered as made one-half by each, the amount of gift tax paid with respect to such gift under chapter 12 shall be the sum of the amounts of tax paid with respect to each half of such gift (computed in the manner provided in paragraph (2)).
For purposes of section 1016(b), an increase in basis under paragraph (1) shall be treated as an adjustment under section 1016(a).
With respect to any property acquired by gift before 1955, references in this subsection to any provision of this title shall be deemed to refer to the corresponding provision of the Internal Revenue Code of 1939 or prior revenue laws which was effective for the year in which such gift was made.
In the case of any gift made after
December 31, 1976
, the increase in basis provided by this subsection with respect to any gift for the gift tax paid under chapter 12 shall be an amount (not in excess of the amount of tax so paid) which bears the same ratio to the amount of tax so paid as—
the net appreciation in value of the gift, bears to
the amount of the gift.
For purposes of paragraph (1), the net appreciation in value of any gift is the amount by which the fair market value of the gift exceeds the donor’s adjusted basis immediately before the gift.
In the case of any property acquired by gift in a transfer described in section 1041(a), the basis of such property in the hands of the transferee shall be determined under section 1041(b)(2) and not this section.
Treasury Regulations
- Treas. Reg. §Treas. Reg. §1.1015-1 Basis of property acquired by gift after December 31, 1920
- Treas. Reg. §Treas. Reg. §1.1015-1(a) General rule.
- Treas. Reg. §Treas. Reg. §1.1015-1(b) Uniform basis; proportionate parts of.
- Treas. Reg. §Treas. Reg. §1.1015-1(c) Time of acquisition.
- Treas. Reg. §Treas. Reg. §1.1015-1(d) Property acquired by gift from a decedent dying after December 31, 1953.
- Treas. Reg. §Treas. Reg. §1.1015-1(e) Fair market value.
- Treas. Reg. §Treas. Reg. §1.1015-1(f) Reinvestments by fiduciary.
- Treas. Reg. §Treas. Reg. §1.1015-1(g) Records.
- Treas. Reg. §Treas. Reg. §1.1015-2 Transfer of property in trust after December 31, 1920
- Treas. Reg. §Treas. Reg. §1.1015-2(a) General rule.
- Treas. Reg. §Treas. Reg. §1.1015-2(b) Reinvestment by fiduciary.
- Treas. Reg. §Treas. Reg. §1.1015-3 Gift or transfer in trust before January 1, 1921
- Treas. Reg. §Treas. Reg. §1.1015-3(a) In the case of property acquired by gift or transfer in trust before January 1, 1921, the basis of such property is the fair market value thereof at the time of the gift or at the time of the transfer in trust.
- Treas. Reg. §Treas. Reg. §1.1015-3(b) The principles stated in paragraph (b) of § 1.
- Treas. Reg. §Treas. Reg. §1.1015-4 Transfers in part a gift and in part a sale
- Treas. Reg. §Treas. Reg. §1.1015-4(a) General rule.
- Treas. Reg. §Treas. Reg. §1.1015-4(b) Examples.
- Treas. Reg. §Treas. Reg. §1.1015-4(i) §1.1015-4(i)
- Treas. Reg. §Treas. Reg. §1.1015-5 Increased basis for gift tax paid
- Treas. Reg. §Treas. Reg. §1.1015-5(a) General rule in the case of gifts made on or before December 31, 1976.
- Treas. Reg. §Treas. Reg. §1.1015-5(b) Amount of gift tax paid with respect to gifts made on or before December 31, 1976.
- Treas. Reg. §Treas. Reg. §1.1015-5(c) Special rule for increased basis for gift tax paid in the case of gifts made after December 31, 1976—(1) In general.
- Treas. Reg. §Treas. Reg. §1.1015-5(d) Treatment as adjustment to basis.
65 Citing Cases
Section 1015 flatly contradicts their position. Section 1015(a) governs transfers by gift, and section 1015(b) governs transfers in trust (other than transfers in trust by gift). Under either provision, the basis in the property “shall be the same as it would be in the hands of the donor” under section 1015(a) or “in the hands of the grantor” under section 1015(b).37 And the Gerhardts’ claim that section 1015 does not govern transfers to CRATs because it does not specifically mention them is mer
Section 1015 provides that, if property is transferred (in trust or otherwise) by gift, “the basis shall be the same as it would be in the hands of the donor,” increased by any gift tax paid on the transfer.
Pursuant to section 1015(a), petitioner's basis in the 4Respondent agrees that petitioner's cost basis in the McCloskey Road property is $234,312, the amount that he paid for his interest in that property when he and the Fiscalinis purchased it in 1993.
A taxpayer who inherits property takes a basis in the property equal to its fair market value at the date of the decedent's death. Sec. 1014(a). Petitioner did not establish the basis she had in property that she received by gift or inheritance. For example, she did not show that the fair market value she provided was determined at the t
1011 and following).” Under section 1015, the basis of property acquired by gift is the same in the hands of the donee as it would be in the hands of the donor, unless the donor’s basis is “greater than the fair market value of the property at the time of the gift,” in which case the donee’s basis shall be the fair market value of the property for the purpose of determining l
and obsolescence are to be allowed in respect of any property is the adjusted basis as provided in section 1011. Sec. 167(c). Under section 1011, the adjusted basis tof property is determined by the applicable sections of subchapter 0, which include section 1015. The basis of property acquired by gift is the basis of that property in the hands of the donor. Sec. 1015(a). The adjusted basis of petitioner's parents, the donors, is their cost basis as adjusted by expenditures for improvements made
For purposes of determining loss, however, if that basis is greater than the fair market value of the property at the time of the gift, then the basis is the fair market value at the time of the gift. Id. 7 In the case of a distribution by a partnership to a partner other than in liquidation of a partner’s interest, the adjusted basis of
Respondent argues that petitioner wife had no basis in the lot because her father, LoChirco, misappropriated it from Oliver Homes. Respondent argues that because transactions within a family group are subject to special scrutiny, Fitz Gibbon v. Commissioner, 19 T.C. 78, 84 (1952), and because LoChirco was petitioner wife's father, his fa
100-647, § 1015(r)(2), 102 Stat.
Each trading company and main trust takes its own basis from [Lojas] Arapua[, S.A.] or Globex [Utilidades, S.A.] by carryoverunder Section 721 [sic 723] or Section 1015." The Court disagrees with petitioner that the partnerships may now recharacterize their transactions for Federal income tax purposes as mere agent-principal transactions to reflect the substance rather than the form ofthe transactions.
Each trading company and main trust takes its own basis from [Lojas] Arapua[, S.A.] or Globex [Utilidades, S.A.] by carryoverunder Section 721 [sic 723] or Section 1015." The Court disagrees with petitioner that the partnerships may now recharacterize their transactions for Federal income tax purposes as mere agent-principal transactions to reflect the substance rather than the form ofthe transactions.
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust's beneficiary and grantor, by virtue ofthe investor's cash "contribution" to the main trust. Because the terms ofthe various trust documents entitled the investor to take direct ownership ofthe subtru
After those receivables had been allocated to a subtrust and an investor designated as its beneficiary, the investor would be the subtrust’s beneficiary and grantor, by virtue of the investor’s cash “contribution” to the main trust. Because the terms of the various trust documents entitled the investor to take direct ownership of the sub
In order for the Court to determine whether petitioner is entitled to a casualty loss, petitioner’s basis in the property damaged or destroyed must be known. Where a taxpayer fails to prove that basis, the Court is unable to determine the amount of the loss that is deductible. Zmuda v. Commissioner, 79 T.C. 714, 727-728 (1982), affd. on
In order for the Court to determine whether petitioners are entitled to a casualty loss, petitioners' basis in the property damaged or destroyed must be known. Where petitioners fail to prove that basis, the Court is unable to determine the amount of the loss that is deductible. Zmuda v. Commissioner, 79 T.C. 714, 728-729 (1982), affd. 7
s the tax by the taxpayer on such return (determined without regard to such credits), shall be taken into account as negative amounts of tax. Section 6211(b)(4) was enacted under the Technical and Miscellaneous Revenue Act of 1988, Pub. L. 100-647, sec. 1015(r), 102 Stat. 3572. The legislative history of section 6211(b)(4) reveals that the provision was enacted to expand the definition of a deficiency to permit taxpayers to contest the disallowance of the earned income credit in the Tax Court. I
Section 6211(b)(4) was enacted by section 1015(r) of the Technical and Miscellaneous Revenue Act of 1988, Pub.