In a Chief Counsel's Advice, the IRS has said that gift taxes can be refunded when a local court correctly applies state law to rescind the gift. But, the IRS noted that no refund will occur until the taxpayer recovers the original gift. In addition, the IRS said that the statute of limitations should be extended to allow the taxpayer to apply for a refund when the taxpayer gets the gift back. C.C.A. 201412015 (Jan 15, 2014).