IRC Section 2642(g)(1) Proposed RegulationsIRC Section 2642(g)(1) Proposed Regulations
On April 17, 2008, proposed regulations were issued providing guidance on the application of Internal Revenue Code Section 2642(g)(1). The proposed regs describe the circumstances under which an extension of time will be granted to: allocate generation-skipping transfer (GST) tax exemption to a transfer; elect under IRC Section 2632(b); not have the deemed allocation of GST exemption apply to a direct
January 1, 2009
David A. Handler
On April 17, 2008, proposed regulations were issued providing guidance on the application of Internal Revenue Code Section 2642(g)(1). The proposed regs describe the circumstances under which an extension of time will be granted to:
allocate generation-skipping transfer (GST) tax exemption to a transfer;
elect under IRC Section 2632(b);
not have the deemed allocation of GST exemption apply to a direct skip;
elect under IRC Section 2632(c)(5)(A)(i) to not have the deemed allocation of GST exemption apply to an indirect skip or transfers made to a particular trust; and
elect under IRC Section 2632(c)(5)(A)(ii) to treat a trust as a GST trust for purposes of IRC Section 2632(c).
In 2001, the Internal Revenue Service issued Notice 2001-50, which announced that taxpayers may seek an extension of time to make an allocation of GST exemption. The notice provided that relief will be granted under Treasury Regulations Section 301.9100-3 if the requirements are met, the taxpayer acted reasonably and in good faith, and a grant of relief will not prejudice the interests of the government. If relief is granted, the amount of the GST exemption allocated to the transfer is the...
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