Deduction for Expenses in Taxable Terminations

IRC §2622

Allows a deduction for expenses, indebtedness, and taxes (similar to IRC 2053) when calculating the taxable amount of a generation-skipping transfer resulting from a taxable termination.

Eligibility

Applies to trusts experiencing a taxable termination where administrative expenses or debts are attributable to the property being transferred.

Frequently Asked Questions

Who is eligible for the Deduction for Expenses in Taxable Terminations?

Applies to trusts experiencing a taxable termination where administrative expenses or debts are attributable to the property being transferred.

How does the Deduction for Expenses in Taxable Terminations work?

Allows a deduction for expenses, indebtedness, and taxes (similar to IRC 2053) when calculating the taxable amount of a generation-skipping transfer resulting from a taxable termination.

What law authorizes the Deduction for Expenses in Taxable Terminations?

The Deduction for Expenses in Taxable Terminations is authorized under IRC §2622 of the Internal Revenue Code (Title 26, United States Code).

Statutory Text — IRC §2622

Source: Internal Revenue Code, Title 26, United States Code

§ 2622. Taxable amount in case of taxable termination(a) In generalFor purposes of this chapter, the taxable amount in the case of a taxable termination shall be—(1) the value of all property with respect to which the taxable termination has occurred, reduced by (2) any deduction allowed under subsection (b). (b) Deduction for certain expensesFor purposes of subsection (a), there shall be allowed a deduction similar to the deduction allowed by section 2053 (relating to expenses, indebtedness, and taxes) for amounts attributable to the property with respect to which the taxable termination has occurred. (Added Pub. L. 94–455, title XX, § 2006(a), Oct. 4, 1976, 90 Stat. 1888; amended Pub. L. 99–514, title XIV, § 1431(a), Oct. 22, 1986, 100 Stat. 2720.) Editorial Notes Amendments1986—Pub. L. 99–514 amended section generally, substituting provisions relating to taxable amount in case of a taxable termination for former provisions which authorized the Secretary to promulgate regulations. See section 2663 of this title. Statutory Notes and Related Subsidiaries Effective Date of 1986 AmendmentSection applicable to generation-skipping transfers (within the meaning of section 2611 of this title) made after Oct. 22, 1986, except as otherwise provided, see section 1433 of Pub. L. 99–514, set out as a note under section 2601 of this title.

Legal Sources

US Code (Official) — 26 USC §2622 → Cornell Law Institute — 26 USC §2622 → Search IRS.gov for IRC §2622 → Treasury Regulations (26 CFR) →

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