- Ag Docket
As part of an estate plan, a husband created a trust for the benefit of his wife and their descendants. The trustee could pay to or use for the benefit of any of the beneficiaries any amount of the trust income and principal as the trustee determined necessary for a beneficiary's support, health and education. The husband also established two grantor retained income trusts (GRATs) with the remaining trust assets at the end of the GRAT term paid to the trust. The couple filed gift tax returns and elected to split the gifts to the trusts such that one-half of each gift would be deemed to have been made by each spouse for purposes of gift tax. The IRS, citing, I.R.C. Sec. 2513 and Rev. Rul. 56-439, denied split gift treatment because the spouse was a beneficiary of the trusts. A split gift election is only permissible for gifts to someone other than a spouse. No gifts were eligible for split gift treatment. Priv. Ltr. Rul. 201523003 (Jan. 28, 2015).
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