26 U.S.C. § 2612

Taxable termination; taxable distribution; direct skip

Read at: OLRCuscode.house.gov CornellLII GovInfogovinfo.gov JustiaTitle 26 CasesGoogle Scholar

(a) Taxable termination(1) General ruleFor purposes of this chapter, the term “taxable termination” means the termination (by death, lapse of time, release of power, or otherwise) of an interest in property held in a trust unless—(A) immediately after such termination, a non-skip person has an interest in such property, or(B) at no time after such termination may a distribution (including distributions on termination) be made from such trust to a skip person.(2) Certain partial terminations treated as taxable

If, upon the termination of an interest in property held in trust by reason of the death of a lineal descendant of the transferor, a specified portion of the trust’s assets are distributed to 1 or more skip persons (or 1 or more trusts for the exclusive benefit of such persons), such termination shall constitute a taxable termination with respect to such portion of the trust property.

(b) Taxable distribution

For purposes of this chapter, the term “taxable distribution” means any distribution from a trust to a skip person (other than a taxable termination or a direct skip).

The term “direct skip” means a transfer subject to a tax imposed by chapter 11 or 12 of an interest in property to a skip person.

(2) Look-thru rules not to apply

Solely for purposes of determining whether any transfer to a trust is a direct skip, the rules of section 2651(f)(2) shall not apply.

(Added Pub. L. 94–455, title XX, § 2006(a), Oct. 4, 1976, 90 Stat. 1883; amended Pub. L. 99–514, title XIV, § 1431(a), Oct. 22, 1986, 100 Stat. 2719; Pub. L. 100–647, title I, § 1014(g)(5)(B), (7), (15), Nov. 10, 1988, 102 Stat. 3564–3566; Pub. L. 105–34, title V, § 511(b), Aug. 5, 1997, 111 Stat. 861.)Editorial NotesAmendments

1997—Subsec. (c)(2). Pub. L. 105–34, § 511(b)(2), substituted “section 2651(f)(2)” for “section 2651(e)(2)”.

Pub. L. 105–34, § 511(b)(1), redesignated par. (3) as (2) and struck out heading and text of former par. (2). Text read as follows: “For purposes of determining whether any transfer is a direct skip, if—

“(A) an individual is a grandchild of the transferor (or the transferor’s spouse or former spouse), and

“(B) as of the time of the transfer, the parent of such individual who is a lineal descendant of the transferor (or the transferor’s spouse or former spouse) is dead,

such individual shall be treated as if such individual were a child of the transferor and all of that grandchild’s children shall be treated as if they were grandchildren of the transferor. In the case of lineal descendants below a grandchild, the preceding sentence may be reapplied. If any transfer of property to a trust would be a direct skip but for this paragraph, any generation assignment under this paragraph shall apply also for purposes of applying this chapter to transfers from the portion of the trust attributable to such property.”

Subsec. (c)(3). Pub. L. 105–34, § 511(b)(1), redesignated par. (3) as (2).

1988—Subsec. (a)(2). Pub. L. 100–647, § 1014(g)(15), amended par. (2) generally. Prior to amendment, par. (2) read as follows: “If, upon the termination of an interest in property held in a trust, a specified portion of the trust assets are distributed to skip persons who are lineal descendants of the holder of such interest (or to 1 or more trusts for the exclusive benefit of such persons), such termination shall constitute a taxable termination with respect to such portion of the trust property.”

Subsec. (c)(2). Pub. L. 100–647, § 1014(g)(7), in closing provisions, inserted at end “If any transfer of property to a trust would be a direct skip but for this paragraph, any generation assignment under this paragraph shall apply also for purposes of applying this chapter to transfers from the portion of the trust attributable to such property.”

Subsec. (c)(3). Pub. L. 100–647, § 1014(g)(5)(B), added par. (3).

1986—Pub. L. 99–514 amended section generally, substituting provisions covering definition and application of “taxable termination”, “taxable distribution”, and “direct skip” for former provisions which indicated who the “deemed transferor” would be for purposes of this chapter and that, for purposes of determining the person deemed the transferor, a parent related to the grantor of a trust by blood or adoption was to be deemed more closely related than a parent related to a grantor by marriage.

Statutory Notes and Related SubsidiariesEffective Date of 1997 Amendment

Pub. L. 105–34, title V, § 511(c), Aug. 5, 1997, 111 Stat. 861, provided that: “The amendments made by this section [amending this section and section 2651 of this title] shall apply to terminations, distributions, and transfers occurring after December 31, 1997.”

Effective Date of 1988 Amendment

Amendment by Pub. L. 100–647 effective, except as otherwise provided, as if included in the provision of the Tax Reform Act of 1986, Pub. L. 99–514, to which such amendment relates, see section 1019(a) of Pub. L. 100–647, set out as a note under section 1 of this title.

Effective Date of 1986 Amendment

Section applicable to generation-skipping transfers (within the meaning of section 2611 of this title) made after Oct. 22, 1986, except as otherwise provided, see section 1433 of Pub. L. 99–514, set out as a note under section 2601 of this title.

Notes of Decisions

Cited in 15 cases, 1929–2020 · leading case: Metzler v. Fed. Home Loan Bank, 464 F.3d 1164 (10th Cir. 2006).

Sort: Relevance Newest Treatment

Metzler v. Fed. Home Loan Bank, 464 F.3d 1164 (10th Cir. 2006). “26 U.S.C. §§ 2612 (a)(1), 2614(a). Under the FMLA, an employer may not “interfere with, restrain, or deny the exercise of or the attempt to exercise, any right provided under [the FMLA].”

In re the Est. of Choate, 63 A.F.T.R. (P-H) 1553 (N.Y. Sur. Ct. 1988). · cites it 2× “The most important tax expansion by the new law was to apply the GST to "direct skips” ( 26 USC § 2612 [c] [1]). Under both the old and new law, a transfer from a grandparent to a trust for a child and then to a grandchild is a taxable transfer.”

Cynthia Holliday v. Bd. of Supervisors of Lsu Agric. & Mech. Coll., Etc., 149 So. 3d 227 (La. 2014). “In Coleman , a plurality of the Supreme Court found the self-care provision at issue in the present case, 26 U.S.C. § 2612 (a)(1)(D), was not well-tailored to address a pattern of constitutional violations and, therefore, was an invalid abrogation of the States’ sovereign…”

Whitaker v. Bosch Braking Sys. Div. of Robert Bosch Corp., 180 F. Supp. 2d 922 (W.D. Mich. 2001). “In this case, Plaintiff claims that she was entitled to FMLA leave pursuant to 26 U.S.C. § 2612 (a)(1)(D), which grants leave based on “a serious health condition that makes the employee unable to perform the functions of the position of such employee.”

John M. Simpson & Sarah S. Dean, Trs. of the Grover M. Simpson Testamentary Trust a v. United States, 183 F.3d 812 (8th Cir. 1999). “It is sufficient for present purposes to know that the transfer was a “direct skip” within the meaning of 26 U.S.C. § 2612 (c)(1), because Mrs. Simpson’s grandchildren were “skip persons” within the meaning of the statute.”

Naumkeag Steam Cotton Co. v. United States, 2 F. Supp. 126 (Ct. Cl. 1933). “The problem is already under consideration by the Joint Committee on Internal Revenue Taxation, and it will be presented to the Congress as soon as it convenes for such action toward a clarification of the situation as it deems proper." The result was the enactment in the…”

Townsend-Taylor v. Ameritech Servs., Inc., 523 F.3d 815 (7th Cir. 2008). “In any event it is most unlikely that the back condition that precipitated her application for FMLA leave was a “serious health condition” within the meaning of the statute, 26 U.S.C. § 2612 (a)(1)(D), which was the only ground for her requesting FMLA leave.”

Johnson v. Mithun, 401 F. Supp. 2d 964 (D. Minnesota 2005). “26 U.S.C. § 2612 . Employers may not “interfere” with or “deny” employees their rights under the FMLA.”

Est. of Timken v. United States, 630 F. Supp. 2d 823 (N.D. Ohio 2009). “As the children of some of the nephews and nieces of Louise Blyth Timken, Alexander C.”

Pepsin Syrup Co. v. Schwaner, 35 F.2d 197 (S.D. Ill. 1929). “” The tax here sought to be recovered and the right to recover it was barred by seetion 1106 (a) of the Revenue Act of 1926 before it was paid under duress by the taxpayer.”

dela Cruz v. Brennan (N.D. Cal. 2020). “” 26 U.S.C. § 2612 (a)(1). A 25 serious health condition is “an illness, injury, impairment, or physical or mental condition that 26 involves (A) in patient care in a hospital, hospice, or residential medical care facility; or (B) 27 continuing treatment by a heath care provider.”

Haworth v. Round Lake Area Schs. Cmty. Unit Sch. Dist. 116 (N.D. Ill. 2019). “1999) (citing 26 U.S.C. § 2612 (a)(1)). Upon return from FMLA leave, employees must be restored to the same position or an equivalent one, with the same benefits and terms of employment.”

Show all 15 citing cases →

Annotations are extracted automatically from the opinions in the Syfert caselaw corpus and ranked by authority, recency, and treatment. Dots show Syfertize treatment of the citing case itself.