The IRS has many rules regarding the actions taken by taxpayers within three years of their death. A recent Tax Court ruling (in July of this year), has now established that checks written prior to the decedent’s death, but not deposited by the recipient, are not completed gifts. Therefore, these gifts are not exempt from Federal estate and gift taxes. The takeaway? Be prompt in depositing gift checks from people on their death beds.
-Emily A. Helmick, Esq.