Estate Plan Lessons from DeMuth v. Commissioner

Lifetime gifts are a popular way to reduce estate and inheritance taxes.
To lower their taxable estate at death, an individual may consider giving gifts to friends and family members. The timing and form of gifts have important estate planning implications, however, as a recent opinion from the United States Court of Appeals for the Third Circuit demonstrates. In that case, the failure to complete gifts in the form of checks prior to the donor’s death cost his estate-and ultimately, his heirs-a significant sum of money.