The Tax Court disallowed an estate from claiming the marital deduction because the decedent’s wife did not predecease him. In this case, the decedent and his wife both suffered from a fatal disease. They had wills drafted that indicated that if the wife died within six months of the decedent’s death it should be deemed that the wife survived him. The decedent’s wife died 46 days before him. The estate claimed a marital deduction, which the IRS disallowed. The Tax Court found that because a will cannot be drafted in order to alter the actual order of deaths, the decedent’s estate did not qualify for the marital deduction.
Points of Interest
- Whether your company is large or small, policy handbooks are a necessary instrument to your business.
- A clear indication of the benefits, including what amounts or time periods involved, should be clearly spelled out.
- The ultimate importance of a policy handbook is the effect it may have in court. Committing to your position in writing prior to a dispute or court case can have a profound effect on the outcome of the circumstances.
By: Basi & Basi at the Center for Financial, Legal and Tax Planning for Transworld M&A Advisors