26 U.S.C. § 2014 — Credit for foreign death taxes

Page 2572 TITLE 26—INTERNAL REVENUE CODE § 2014 (3) if the decedent was the spouse of the transferor at the time of the transferor’s death, the net value of the property trans- ferred to the decedent shall be reduced by the amount allowed under section 2056 (relating to marital deductions), as a deduction from the gross estate of the transferor. (e) Property defined For purposes of this section, the term ‘‘prop- erty’’ includes any beneficial interest in prop- erty, including a general power of appointment (as defined in section 2041). (f) Treatment of additional tax imposed under section 2032A If section 2032A applies to any property in- cluded in the gross estate of the transferor and an additional tax is imposed with respect to such property under section 2032A(c) before the date which is 2 years after the date of the dece- dent’s death, for purposes of this section— (1) the additional tax imposed by section 2032A(c) shall be treated as a Federal estate tax payable with respect to the estate of the transferor; and (2) the value of such property and the amount of the taxable estate of the transferor shall be determined as if section 2032A did not apply with respect to such property. (Aug. 16, 1954, ch. 736, 68A Stat. 377; Pub. L. 94–455, title XIX, § 1902(a)(2), title XX, §§ 2001(c)(1)(C), 2003(c), 2006(b)(2), Oct. 4, 1976, 90 Stat. 1804, 1850, 1862, 1888; Pub. L. 99–514, title XIV, § 1432(c)(2), Oct. 22, 1986, 100 Stat. 2730; Pub. L. 100–647, title I, § 1011A(g)(7), Nov. 10, 1988, 102 Stat. 3481; Pub. L. 105–34, title X, § 1073(b)(2), Aug. 5, 1997, 111 Stat. 948; Pub. L. 107–16, title V, § 532(c)(2), June 7, 2001, 115 Stat. 74.) Editorial Notes AMENDMENTS 2001—Subsec. (c)(1)(A). Pub. L. 107–16 struck out ‘‘2011,’’ after ‘‘sections 2010,’’. 1997—Subsec. (g). Pub. L. 105–34 struck out heading and text of subsec. (g). Prior to amendment, text read as follows: ‘‘For purposes of this section, the estate tax paid shall not include any portion of such tax attrib- utable to section 4980A(d).’’ 1988—Subsec. (g). Pub. L. 100–647 added subsec. (g). 1986—Subsec. (g). Pub. L. 99–514 struck out subsec. (g) which provided for treatment of tax imposed on certain generation-skipping transfers. 1976—Subsec. (b). Pub. L. 94–455, § 2001(c)(1)(C)(i), struck out ‘‘and increased by the exemption provided for by section 2052 or section 2106(a)(3), or the cor- responding provisions of prior laws, in determining the taxable estate of the transferor for purposes of the es- tate tax’’ after ‘‘death taxes paid with respect to such estate’’. Subsec. (c)(1)(A). Pub. L. 94–455, § 2001(c)(1)(C)(ii), sub- stituted ‘‘credits provided for in sections 2010, 2011, 2012, and 2014) computed’’ for ‘‘credits for State death taxes, gift tax, and foreign death taxes provided for in sec- tions 2011, 2012, and 2014) computed’’. Subsec. (d)(3). Pub. L. 94–455, § 1902(a)(2), struck out ‘‘, or the corresponding provision of prior law,’’ after ‘‘marital deductions)’’. Subsec. (f). Pub. L. 94–455, § 2003(c), added subsec. (f). Subsec. (g). Pub. L. 94–455, § 2006(b)(2), added subsec. (g). Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2001 AMENDMENT Amendment by Pub. L. 107–16 applicable to estates of decedents dying, and generation-skipping transfers, after Dec. 31, 2004, see section 532(d) of Pub. L. 107–16, set out as a note under section 2012 of this title. EFFECTIVE DATE OF 1997 AMENDMENT Amendment by Pub. L. 105–34 applicable to estates of decedents dying after Dec. 31, 1996, see section 1073(c) of Pub. L. 105–34, set out as an Effective Date of Repeal note under section 4980A of this title. EFFECTIVE DATE OF 1988 AMENDMENT Amendment by Pub. L. 100–647 effective, except as otherwise provided, as if included in the provision of the Tax Reform Act of 1986, Pub. L. 99–514, to which such amendment relates, see section 1019(a) of Pub. L. 100–647, set out as a note under section 1 of this title. EFFECTIVE DATE OF 1986 AMENDMENT Amendment by Pub. L. 99–514 applicable to genera- tion-skipping transfers (within the meaning of section 2611 of this title) made after Oct. 22, 1986, except as oth- erwise provided, see section 1433 of Pub. L. 99–514, set out as an Effective Date note under section 2601 of this title. EFFECTIVE DATE OF 1976 AMENDMENT Amendment by section 1902(a)(2) of Pub. L. 94–455 ap- plicable to estates of decedents dying after Oct. 4, 1976, see section 1902(c)(1) of Pub. L. 94–455, set out as a note under section 2012 of this title. § 2014. Credit for foreign death taxes (a) In general The tax imposed by section 2001 shall be cred- ited with the amount of any estate, inheritance, legacy, or succession taxes actually paid to any foreign country in respect of any property situ- ated within such foreign country and included in the gross estate (not including any such taxes paid with respect to the estate of a person other than the decedent). The determination of the country within which property is situated shall be made in accordance with the rules applicable under subchapter B (sec. 2101 and following) in determining whether property is situated within or without the United States. (b) Limitations on credit The credit provided in this section with re- spect to such taxes paid to any foreign coun- try— (1) shall not, with respect to any such tax, exceed an amount which bears the same ratio to the amount of such tax actually paid to such foreign country as the value of property which is— (A) situated within such foreign country, (B) subjected to such tax, and (C) included in the gross estate bears to the value of all property subjected to such tax; and (2) shall not, with respect to all such taxes, exceed an amount which bears the same ratio to the tax imposed by section 2001 (after de- ducting from such tax the credits provided by sections 2010 and 2012) as the value of property which is— (A) situated within such foreign country, (B) subjected to the taxes of such foreign country, and Page 2573 TITLE 26—INTERNAL REVENUE CODE § 2014 (C) included in the gross estate bears to the value of the entire gross estate re- duced by the aggregate amount of the deduc- tions allowed under sections 2055 and 2056. (c) Valuation of property (1) The values referred to in the ratio stated in subsection (b)(1) are the values determined for purposes of the tax imposed by such foreign country. (2) The values referred to in the ratio stated in subsection (b)(2) are the values determined under this chapter; but, in applying such ratio, the value of any property described in subpara- graphs (A), (B), and (C) thereof shall be reduced by such amount as will properly reflect, in ac- cordance with regulations prescribed by the Sec- retary, the deductions allowed in respect of such property under sections 2055 and 2056 (relating to charitable and marital deductions). (d) Proof of credit The credit provided in this section shall be al- lowed only if the taxpayer establishes to the satisfaction of the Secretary— (1) the amount of taxes actually paid to the foreign country, (2) the amount and date of each payment thereof, (3) the description and value of the property in respect of which such taxes are imposed, and (4) all other information necessary for the verification and computation of the credit. (e) Period of limitation The credit provided in this section shall be al- lowed only for such taxes as were actually paid and credit therefor claimed within 4 years after the filing of the return required by section 6018, except that— (1) If a petition for redetermination of a defi- ciency has been filed with the Tax Court with- in the time prescribed in section 6213(a), then within such 4-year period or before the expira- tion of 60 days after the decision of the Tax Court becomes final. (2) If, under section 6161, an extension of time has been granted for payment of the tax shown on the return, or of a deficiency, then within such 4-year period or before the date of the expiration of the period of the extension. Refund based on such credit may (despite the provisions of sections 6511 and 6512) be made if claim therefor is filed within the period above provided. Any such refund shall be made without interest. (f) Additional limitation in cases involving a de- duction under section 2053(d) In any case where a deduction is allowed under section 2053(d) for an estate, succession, legacy, or inheritance tax imposed by and actually paid to any foreign country upon a transfer by the decedent for public, charitable, or religious uses described in section 2055, the property described in subparagraphs (A), (B), and (C) of paragraphs (1) and (2) of subsection (b) of this section shall not include any property in respect of which such deduction is allowed under section 2053(d). (g) Possession of United States deemed a foreign country For purposes of the credits authorized by this section, each possession of the United States shall be deemed to be a foreign country. (h) Similar credit required for certain alien resi- dents Whenever the President finds that— (1) a foreign country, in imposing estate, in- heritance, legacy, or succession taxes, does not allow to citizens of the United States resi- dent in such foreign country at the time of death a credit similar to the credit allowed under subsection (a), (2) such foreign country, when requested by the United States to do so has not acted to provide such a similar credit in the case of citizens of the United States resident in such foreign country at the time of death, and (3) it is in the public interest to allow the credit under subsection (a) in the case of citi- zens or subjects of such foreign country only if it allows such a similar credit in the case of citizens of the United States resident in such foreign country at the time of death, the President shall proclaim that, in the case of citizens or subjects of such foreign country dying while the proclamation remains in effect, the credit under subsection (a) shall be allowed only if such foreign country allows such a simi- lar credit in the case of citizens of the United States resident in such foreign country at the time of death. (Aug. 16, 1954, ch. 736, 68A Stat. 378; Pub. L. 85–866, title I, § 102(c)(2), Sept. 2, 1958, 72 Stat. 1674; Pub. L. 86–175, § 2, Aug. 21, 1959, 73 Stat. 397; Pub. L. 89–809, title I, § 106(b)(3), Nov. 13, 1966, 80 Stat. 1570; Pub. L. 94–455, title XIX, § 1906(b)(13)(A), title XX, § 2001(c)(1)(G), Oct. 4, 1976, 90 Stat. 1834, 1852; Pub. L. 107–16, title V, § 532(c)(3), June 7, 2001, 115 Stat. 74.) Editorial Notes AMENDMENTS 2001—Subsec. (b)(2). Pub. L. 107–16 struck out ‘‘, 2011,’’ after ‘‘sections 2010’’ in introductory provisions. 1976—Subsec. (b)(2). Pub. L. 94–455, § 2001(c)(1)(G), in- serted reference to section 2010 in introductory provi- sions. Subsecs. (c), (d). Pub. L. 94–455, § 1906(b)(13)(A), struck out ‘‘or his delegate’’ after ‘‘Secretary’’. 1966—Subsec. (a). Pub. L. 89–809 struck out provision that, if the decedent at the time of his death was not a citizen of the United States, credit would not be al- lowed under this section unless the foreign country of which the decedent was a citizen or subject, in impos- ing estate, inheritance, legacy, or succession taxes, al- lows a similar credit in the case of a citizen of the United States resident in such country. Subsec. (h). Pub. L. 89–809 added subsec. (h). 1959—Subsecs. (f), (g). Pub. L. 86–175 added subsec. (f) and redesignated former subsec. (f) as (g). 1958—Subsec. (f). Pub. L. 85–866 added subsec. (f). Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2001 AMENDMENT Amendment by Pub. L. 107–16 applicable to estates of decedents dying, and generation-skipping transfers, after Dec. 31, 2004, see section 532(d) of Pub. L. 107–16, set out as a note under section 2012 of this title. Page 2574 TITLE 26—INTERNAL REVENUE CODE § 2015 EFFECTIVE DATE OF 1966 AMENDMENT Amendment by Pub. L. 89–809 applicable with respect to estates of decedents dying after Nov. 13, 1966, see sec- tion 106(b)(4) of Pub. L. 89–809, set out as a note under section 901 of this title. EFFECTIVE DATE OF 1959 AMENDMENT Amendment by Pub. L. 86–175 applicable with respect to estates of decedents dying on or after July 1, 1955, see section 4 of Pub. L. 86–175, set out as a note under section 2053 of this title. EFFECTIVE DATE OF 1958 AMENDMENT Pub. L. 85–866, title I, § 102(d), Sept. 2, 1958, 72 Stat. 1675, provided that: ‘‘The amendments made by this section (other than by subsection (b)) [enacting section 2208 of this title and amending this section and sections 2011 and 2053 of this title] shall apply to the estates of decedents dying after the date of the enactment of this Act [Sept. 2, 1958]. The amendment made by subsection (b) [amending section 2501 of this title] shall apply to gifts made after the date of the enactment of this Act.’’ § 2015. Credit for death taxes on remainders Where an election is made under section 6163(a) to postpone payment of the tax imposed by section 2001, or 2101, such part of any estate, inheritance, legacy, or succession taxes allow- able as a credit under section 2014, as is attrib- utable to a reversionary or remainder interest may be allowed as a credit against the tax at- tributable to such interest, subject to the limi- tations on the amount of the credit contained in such sections, if such part is paid, and credit therefor claimed, at any time before the expira- tion of the time for payment of the tax imposed by section 2001 or 2101 as postponed and extended under section 6163. (Aug. 16, 1954, ch. 736, 68A Stat. 379; Pub. L. 85–866, title I, § 66(a)(1), Sept. 2, 1958, 72 Stat. 1657; Pub. L. 107–16, title V, § 532(c)(4), June 7, 2001, 115 Stat. 74.) Editorial Notes AMENDMENTS 2001—Pub. L. 107–16 struck out ‘‘2011 or’’ before ‘‘2014’’. 1958—Pub. L. 85–866 substituted ‘‘the time for pay- ment of the tax imposed by section 2001 or 2101 as post- poned and extended under section 6163’’ for ‘‘60 days after the termination of the precedent interest or inter- ests in the property’’. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2001 AMENDMENT Amendment by Pub. L. 107–16 applicable to estates of decedents dying, and generation-skipping transfers, after Dec. 31, 2004, see section 532(d) of Pub. L. 107–16, set out as a note under section 2012 of this title. EFFECTIVE DATE OF 1958 AMENDMENT Pub. L. 85–866, title I, § 66(a)(3), Sept. 2, 1958, 72 Stat. 1658, provided that: ‘‘The amendments made by para- graphs (1) and (2) [amending this section and section 927 of I.R.C. 1939] shall apply in the case of any rever- sionary or remainder interest in property only if the precedent interest or interests in the property did not terminate before the beginning of the 60-day period which ends on the date of the enactment of this Act [Sept. 2, 1958].’’ § 2016. Recovery of taxes claimed as credit If any tax claimed as a credit under section 2014 is recovered from any foreign country, the executor, or any other person or persons recov- ering such amount, shall give notice of such re- covery to the Secretary at such time and in such manner as may be required by regulations pre- scribed by him, and the Secretary shall (despite the provisions of section 6501) redetermine the amount of the tax under this chapter and the amount, if any, of the tax due on such redeter- mination, shall be paid by the executor or such person or persons, as the case may be, on notice and demand. No interest shall be assessed or col- lected on any amount of tax due on any redeter- mination by the Secretary resulting from a re- fund to the executor of tax claimed as a credit under section 2014, for any period before the re- ceipt of such refund, except to the extent inter- est was paid by the foreign country on such re- fund. (Aug. 16, 1954, ch. 736, 68A Stat. 380; Pub. L. 94–455, title XIX, §§ 1902(a)(12)(C), 1906(b)(13)(A), Oct. 4, 1976, 90 Stat. 1806, 1834; Pub. L. 107–16, title V, § 532(c)(4), June 7, 2001, 115 Stat. 74; Pub. L. 107–147, title IV, § 411(h), Mar. 9, 2002, 116 Stat. 46.) Editorial Notes AMENDMENTS 2002—Pub. L. 107–147 struck out ‘‘any State, any pos- session of the United States, or the District of Colum- bia,’’ after ‘‘any foreign country,’’. 2001—Pub. L. 107–16 struck out ‘‘2011 or’’ before ‘‘2014 is recovered’’. 1976—Pub. L. 94–455 struck out ‘‘Territory or’’ after ‘‘any State, any’’ and ‘‘or his delegate’’ after ‘‘Sec- retary’’. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2002 AMENDMENT Amendment by Pub. L. 107–147 effective as if included in the provisions of the Economic Growth and Tax Re- lief Reconciliation Act of 2001, Pub. L. 107–16, to which such amendment relates, see section 411(x) of Pub. L. 107–147, set out as a note under section 25B of this title. EFFECTIVE DATE OF 2001 AMENDMENT Amendment by Pub. L. 107–16 applicable to estates of decedents dying, and generation-skipping transfers, after Dec. 31, 2004, see section 532(d) of Pub. L. 107–16, set out as a note under section 2012 of this title. EFFECTIVE DATE OF 1976 AMENDMENT Amendment by section 1902(a)(12)(C) of Pub. L. 94–455 applicable to estates of decedents dying after Oct. 4, 1976, see section 1902(c)(1) of Pub. L. 94–455, set out as a note under section 2012 of this title. PART III—GROSS ESTATE Sec. 2031. Definition of gross estate. 2032. Alternate valuation. 2032A. Valuation of certain farm, etc., real property. 2033. Property in which the decedent had an inter- est. [2033A. Renumbered.] 2034. Dower or curtesy interests. 2035. Adjustments for certain gifts made within 3 years of decedent’s death. 2036. Transfers with retained life estate. 2037. Transfers taking effect at death. 2038. Revocable transfers. 2039. Annuities. 2040. Joint interests.