§2002 — Liability for payment
31 citing cases
Statute Text — 26 U.S.C. §2002
The tax imposed by this chapter shall be paid by the executor.
Treasury Regulations
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Treas. Reg. §20.2002-1Liability for payment of tax
The Federal estate tax imposed both with respect to the estates of citizens or residents and with respect to estates of nonresidents not citizens is payable by the executor or administrator of the decedent's estate. This duty applies to the entire tax, regardless of the fact that the gross estate consists in part of property which does not come within the possession of the executor or administrator. If there is no executor or administrator appointed, qualified and acting in the United States, any person in actual or constructive possession of any property of the decedent is required to pay the entire tax to the extent of the value of the property in his possession. See section 2203, defining the term “executor”. The personal liability of the executor or such other person is described in section 3467 of the Revised Statutes (31 U.S.C. 192) as follows:
Every executor, administrator, or assignee, or other person, who pays, in whole or in part, any debt due by the person or estate for whom or for which he acts before he satisfies and pays the debts due to the United States from such person or estate, shall become answerable in his own person and estate to the extent of such payments for the debts so due to the United States, or for so much thereof as may remain due and unpaid.
As used in said section, the word “debt” includes a beneficiary's distributive share of an estate. Thus, if the executor pays a debt due by the decedent's estate or distributes any portion of the estate before all the estate tax is paid, he is personally liable, to the extent of the payment or distribution, for so much of the estate tax as remains due and unpaid. In addition, section 6324(a)(2) provides that if the estate tax is not paid when due, then the spouse, transferee, trustee (except the trustee of an employee's trust which meets the requirements of section 401(a)), surviving tenant, person in possession of the property by reason of the exercise, nonexercise, or release of a power of appointment, or beneficiary, who receives, or has on the date of the decedent's death, property included in the gross estate under section 2034 through 2042, is personally liable for the tax to the extent of the value, at the time of the decedent's death, of such property. See also the following related sections of the Internal Revenue Code: Section 2204, discharge of executor from personal liability; section 2205, reimbursement out of estate; sections 2206 and 2207, liability of life insurance beneficiaries and recipients of property over which decedent had power of appointment; sections 6321 through 6325, concerning liens for taxes; and section 6901(a)(1), concerning the liabilities of transferees and fiduciaries.
31 Citing Cases
829, 966–67. Section 6751 was added to the Code in 1998, and the same law also amended section 4973. See IRS Restructuring and Reform Act of 1998, Pub. L. No. 105-206, §§ 3306, 6004(d)(10), 112 Stat. 685, 744, 795. Congress in 1998 did not alter section 4973’s consistent reference to the exaction it imposes as “a tax,” nor did C
The executor may be held personally liable under 31 U.S.C. sec. 3713, often referred to as the Federal Priority Statute (FPS), if the executor pays a debt of the estate before satisfying and paying a claim owed to the United States. 31 U.S.C. sec. 3713(b); sec. 20.2002-1, Estate Tax Regs. (defining a “debt” as including a beneficiary’s d
Section 2002 requires the executor ofthe estate to pay the estate tax.
exempt from claims against the estate. - 34 - IV. Apportionment ofEstate Tax A. Applicable Law 1. The Development ofState Apportionment Statutes Although the Code imposes liability for the Federal estate tax, in the first instance, on the executor, sec. 2002, it also provides the Service with a broad array ofpowers to collect the tax, when necessary, from those who received the decedent's assets. For example, section 6324(a)(1) imposes a 10-year lien on all property included in the decedent's gr
The regulations furtherprovide that "persons holding property of" the taxpayer are not entitled to prelevy or postlevy notice; however, they may seek other avenues ofredress which are not subject to judicial review in the Tax Court.4 Sec. 301.6330-1(b)(2), Q&A-B5, Proced. & Admin. Regs. Upon replacing Mr. Crown as personal representative
ed.) In other words, a taxpayerwho maintains - 13 - [*13] multiple IRAs may not make a rollover contribution from each IRA within one year.5 Section 408 was enacted as part ofthe Employee Retirement Income Security Act of 1974, Pub. L. No. 93-406, sec. 2002(b), 88 Stat. at 958. Recognizing that the American workforce had become much more mobile than in previous years, Congress enacted the section 408(d)(3)(A) exemption as a way of providing employees with some measure offlexibility with regard t
It mandates that the Federal estate tax be paid by the executor under section 2002 and that payment be remitted at the time prescribed for filing under section 6151 (or a later date if extended).
408(d)(3) and 402(c) require, since the distributions consisted of money, that petitioner transfer money to the Smith Barney IRA. Both rollover provisions were enacted as part of the Employee Retirement Income Security Act of 1974, Pub. L. 93-406, sec. 2002(b), (g)(5), 88 Stat. 829, 959-964, 968-969.2 The purpose of allowing a tax-free rollover from a retirement plan to an IRA was to facilitate portability of pensions. Conf. Rept. 93-1280 (1974), 1974-3 C.B. 415, 502; H. Rept. 93-807 (1974), 19
ssioner, T.C. Memo. 1989-643; sec. 20.2040- 1(a)(2), Estate Tax Regs. Petitioner first argues that Ms. Friedeberg contributed consideration in the form of "money" to the value of the assets 6In 1976, subsec. (b) of sec. 2040 was added to the Code by sec. 2002(c)(1) of the Tax Reform Act of 1976, Pub. L. 94-455, 90 Stat. 1520, 1855. The 1976 amendment created a special rule where the joint tenants were husband and wife. Hahn v. Commissioner, 110 T.C. 140, 145 (1998). If the interest were a "quali
dividuals who were active participants in employer-sponsored plans were not permitted to make deductible IRA contributions because they were already benefitting as participants in tax-favored plans. See sec. 219(b)(2) as originally enacted by ERISA sec. 2002, 88 Stat. 958. - 17 - The individual retirement provisions of ERISA expressly provided that a distribution from an IRA was fully taxable to the distributee upon distribution. Specifically, section 408(d)(1), as originally enacted by ERISA, p
fund of Federal estate taxes, the executor is the proper person to bring the refund suit. Hofheinz v. United States, 511 F.2d 661 (5th Cir. 1975). The Court of Appeals for the Fifth Circuit pointed out that the executor actually paid the estate tax (sec. 2002) and was the proper plaintiff-taxpayer for purposes of the refund suit. Similarly, the proper venue for a suit brought by an executor for refund of estate taxes is the judicial district where the executor resides. Kruskal v. United States,
If the executor pays the debts of the estate, or distributes any portion of the estate to a beneficiary, before satisfying the estate’s obligation to the Government for estate taxes, then the executor is personally liable, to the extent of the payment to the estate’s creditors or -6- the distribution to the beneficiary, for so much of t
fund of Federal estate taxes, the executor is the proper person to bring the refund suit. Hofheinz v. United States, 511 F.2d 661 (5th Cir. 1975). The Court of Appeals for the Fifth Circuit pointed out that the executor actually paid the estate tax (sec. 2002) and was the proper plaintiff-taxpayer for purposes of the refund suit. Similarly, the proper venue for a suit brought by an executor for refund of estate taxes is the judicial district where the executor resides. Kruskal v. United States,