Document Type

Article

Publication Date

2003

Abstract

Gifts have been given special treatment by the income tax laws since the first post-16th Amendment tax statute was adopted in 1913. The determination of how the income tax law should treat gifts raises a number of issues. For example: should gifts be given special treatment? If so, what should qualify as a gift? Should gifts to a private party be taxable to the donee? Should gifts to a private party be deductible by the donor? Should the donee's basis in a gift of property be determined by reference to the basis that the donor had, and should any modifications of the donee's basis be made because of transfer taxes or other costs incurred pursuant to executing the transfer? If gifts to charitable organizations are deductible, should the definition of what constitutes a gift be the same as the one employed in determining whether transfers between private parties are gifts?