Gifting Post Mortem

[Edsel]

Can a decedent (died in 2018) still gift to recipients after death, so long as gift was made in calendar 2018?

[Abby Normal]

Decedents can't do anything and that includes giving gifts. In fact, I believe there's a claw back for gifts made close to the date of death.

[DANRVAN]

3 hours ago, Edsel said:

Can a decedent (died in 2018) still gift to recipients after death, so long as gift was made in calendar 2018?

No, all decedent's assets go into estate on date of death.

[Edsel]

Makes good sense.  Thanks.  Any conveyance of property thus becomes an "inheritance" instead of a "gift."

[Possi]

Unless of course, it was something he was dying to give... 

[Catherine]

Might be possible - for instance, a wire transfer was initiated for a gift late on Friday, completed on Monday (say, funds left gifter's bank but not posted to giftee's bank), and the person died on Sunday.  But no gift can be initiated post-death.  Just bequests.    

[SaraEA]

A client transferred some valuable stocks to a couple of creepy relatives a couple of days before he died.  And some things like bank accounts he owned the year before he died and valuables he bequeathed in his will somehow disappeared.  The rest of the family was not happy, some hiring their own attorneys.  The justice was that the creeps did not get stepped-up basis and had huge cap gains.

The only claw back I can think of is that years ago if you gave gifts within 3? years of death they were added to your estate.  With the unified credit, all gifts are added.  There is also a rule that if someone gifts you appreciated property within a year? of your death and you bequeath it to them, they do not get step up.  I'm fuzzy on this and don't have reference materials with me.  Is there something that voids gifts given within a short time of death? 

[DANRVAN]

3 hours ago, SaraEA said:

The only claw back I can think of is that years ago if you gave gifts within 3? years of death they were added to your estate.  With the unified credit, all gifts are added.  There is also a rule that if someone gifts you appreciated property within a year? of your death and you bequeath it to them, they do not get step up.  

1 year rule is under section 1014(e).  That basically applies where property is gifted to donee and then donee bequest back to donor.  That prevents the donor from receiving stepped up basis through death of donee.

Section 2035(a) requires certain assets transferred within three years of death to be included in estate.  Those assets include certain transfers with retained life estate, revocable transfers and certain transfers of life insurance policies.