Page:United States Statutes at Large Volume 111 Part 1.djvu/1068

 Ill STAT. 1044 PUBLIC LAW 105-34—AUG. 5, 1997 "(A) section 303(b) (relating to distributions in redemption of stock to pay death taxes), "(B) section 2032A (relating to special valuation of certain farms, etc., real property), and "(C) subchapter C of chapter 64 (relating to lien for taxes); the value of the gross estate shall include the value of all property to the extent of any interest therein of which the decedent has at any time made a transfer, by trust or otherwise, during the 3-year period ending on the date of the decedent's death. "(2) COORDINATION WITH SECTION eiee.— An estate shall be treated as meeting the 35 percent of adjusted gross estate requirement of section 6166(a)(1) only if the estate meets such requirement both with and without the application of paragraph (1). "(3) MARITAL AND SMALL TRANSFERS.— Paragraph (1) shall not apply to any transfer (other than a transfer with respect to a life insurance policy) made during a calendar year to any donee if the decedent was not required by section 6019 (other than by reason of section 6019(2)) to file any gift tax return for such year with respect to transfers to such donee. " (d) EXCEPTION.— Subsection (a) shall not apply to any bona fide sale for an adequate and fiili consideration in money or money's worth. "(e) TREATMENT OF CERTAIN TRANSFERS FROM REVOCABLE TRUSTS.— For purposes of this section and section 2038, any transfer from any portion of a trust during any period that such portion was treated under section 676 as owned by the decedent by reason of a power in the grantor (determined without regard to section 672(e)) shall be treated as a transfer made directly by the decedent.". (b) CLERICAL AMENDMENT.— The table of sections for part III of subchapter A of chapter 11 is amended by striking "gifts" in the item relating to section 2035 and inserting "certain gifts". 26 USC 2035 (c) EFFECTIVE DATE.— The amendments made by this section note. shall apply to the estates of decedents dying after the date of the enactment of this Act. SEC. 1311. CLARIFICATION OF TREATMENT OF SURVIVOR ANNUITIES UNDER QUALIFIED TERMINABLE INTEREST RULES. (a) IN GENERAL. —Subparagraph (C) of section 2056(b)(7) is amended by inserting "(or, in the case of an interest in an euinuity arising under the community property laws of a State, included in the gross estate of the decedent under section 2033)" after "section 2039". 26 USC 2056 (b) EFFECTIVE DATE. —The amendment made by this section note. shall apply to estates of decedents dying after the date of the enactment of this Act. SEC. 1312. TREATMENT UNDER QUALIFIED DOMESTIC TRUST RULES OF FORMS OF OWNERSHIP WfflCH ARE NOT TRUSTS. (a) IN GENERAL. —Subsection (c) of section 2056A (defining qualified domestic trust) is amended by adding at the end the allowing new paragraph: "(3) TRUST.— To the extent provided in regulations prescribed by the Secretary, the term 'trust' includes other arrangements which have substantially the same effect as a trust.".

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