26 U.S.C. § 2043 — Transfers for insufficient consideration

Page 2597 TITLE 26—INTERNAL REVENUE CODE § 2044 Pub. L. 94–455, title XX, § 2009(b)(4)(A), Oct. 4, 1976, 90 Stat. 1894.) Editorial Notes AMENDMENTS 1976—Subsec. (a)(2). Pub. L. 94–455 struck out provi- sion that a disclaimer or renunciation of a power of ap- pointment not be deemed a release of that power. 1962—Subsec. (a). Pub. L. 87–834 struck out provisions which excepted real property situated outside of the United States. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 1976 AMENDMENT Amendment by Pub. L. 94–455 applicable to transfers creating an interest in person disclaiming made after Dec. 31, 1976, see section 2009(e)(2) of Pub. L. 94–455, set out as a note under section 2518 of this title. EFFECTIVE DATE OF 1962 AMENDMENT Amendment by Pub. L. 87–834 applicable to estates of decedents dying after Oct. 16, 1962, except as otherwise provided, see section 18(b) of Pub. L. 87–834, set out as a note under section 2031 of this title. § 2042. Proceeds of life insurance The value of the gross estate shall include the value of all property— (1) Receivable by the executor To the extent of the amount receivable by the executor as insurance under policies on the life of the decedent. (2) Receivable by other beneficiaries To the extent of the amount receivable by all other beneficiaries as insurance under poli- cies on the life of the decedent with respect to which the decedent possessed at his death any of the incidents of ownership, exercisable ei- ther alone or in conjunction with any other person. For purposes of the preceding sen- tence, the term ‘‘incident of ownership’’ in- cludes a reversionary interest (whether arising by the express terms of the policy or other in- strument or by operation of law) only if the value of such reversionary interest exceeded 5 percent of the value of the policy immediately before the death of the decedent. As used in this paragraph, the term ‘‘reversionary inter- est’’ includes a possibility that the policy, or the proceeds of the policy, may return to the decedent or his estate, or may be subject to a power of disposition by him. The value of a re- versionary interest at any time shall be deter- mined (without regard to the fact of the dece- dent’s death) by usual methods of valuation, including the use of tables of mortality and actuarial principles, pursuant to regulations prescribed by the Secretary. In determining the value of a possibility that the policy or proceeds thereof may be subject to a power of disposition by the decedent, such possibility shall be valued as if it were a possibility that such policy or proceeds may return to the de- cedent or his estate. (Aug. 16, 1954, ch. 736, 68A Stat. 387; Pub. L. 94–455, title XIX, § 1906(b)(13) (A), Oct. 4, 1976, 90 Stat. 1834.) Editorial Notes AMENDMENTS 1976—Pub. L. 94–455 struck out ‘‘or his delegate’’ after ‘‘Secretary’’. § 2043. Transfers for insufficient consideration (a) In general If any one of the transfers, trusts, interests, rights, or powers enumerated and described in sections 2035 to 2038, inclusive, and section 2041 is made, created, exercised, or relinquished for a consideration in money or money’s worth, but is not a bona fide sale for an adequate and full con- sideration in money or money’s worth, there shall be included in the gross estate only the ex- cess of the fair market value at the time of death of the property otherwise to be included on account of such transaction, over the value of the consideration received therefor by the dece- dent. (b) Marital rights not treated as consideration (1) In general For purposes of this chapter, a relinquish- ment or promised relinquishment of dower or curtesy, or of a statutory estate created in lieu of dower or curtesy, or of other marital rights in the decedent’s property or estate, shall not be considered to any extent a consid- eration ‘‘in money or money’s worth’’. (2) Exception For purposes of section 2053 (relating to ex- penses, indebtedness, and taxes), a transfer of property which satisfies the requirements of paragraph (1) of section 2516 (relating to cer- tain property settlements) shall be considered to be made for an adequate and full consider- ation in money or money’s worth. (Aug. 16, 1954, ch. 736, 68A Stat. 388; Pub. L. 98–369, div. A, title IV, § 425(a)(1), July 18, 1984, 98 Stat. 803.) Editorial Notes AMENDMENTS 1984—Subsec. (b). Pub. L. 98–369 amended subsec. (b) generally, designating existing provisions as par. (1) and adding par. (2). Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 1984 AMENDMENT Pub. L. 98–369, div. A, title IV, § 425(c)(1), July 18, 1984, 98 Stat. 804, provided that: ‘‘The amendments made by subsection (a) [amending this section and section 2053 of this title] shall apply to estates of decedents dying after the date of the enactment of this Act [July 18, 1984].’’ § 2044. Certain property for which marital deduc- tion was previously allowed (a) General rule The value of the gross estate shall include the value of any property to which this section ap- plies in which the decedent had a qualifying in- come interest for life. (b) Property to which this section applies This section applies to any property if—