§ 13987.2. Gift Taxes.

(a) In General. In those cases where a decedent made a lifetime gift before January 1, 1977 which is also subject to inheritance tax, a gift tax credit is allowable against the inheritance tax on the lifetime gift (see Revenue and Taxation Code Sections 14071-14077). The gift tax credit is allowable regardless of whether the gift tax is paid before or after the death of the donor. Gift tax paid after the donor's death for which no gift tax credit is allowed against the inheritance tax is treated as a debt of the decedent and allowed as a deduction for inheritance tax purposes.

(b) California Gift Tax. If a California gift tax is paid after the donor's death for which a gift tax credit is allowed, the amount of gift tax paid is not allowable as an inheritance tax deduction to the extent that the gift tax credit is allowed (see Section 14071). The full amount of the gift tax paid after death is allowed as an inheritance tax deduction if the lifetime transfer for which the gift tax is due is not also subject to inheritance tax and the gift tax is paid from assets of the decedent's estate. In any case, penalty and interest which had accrued as of the date of death is allowed as a deduction if it is paid after death from assets of the decedent's estate.

(c) Federal Gift Tax. If a federal gift tax is paid after the donor's death for which a gift tax credit is allowed against the federal estate tax, the amount of gift tax paid is not allowable as an inheritance tax deduction to the extent the gift tax credit is allowed. The full amount of the federal gift tax paid after the death of the donor is allowed as an inheritance tax deduction if the gift for which the gift tax is due is not also subject to federal estate tax and the gift tax is paid from assets of the decedent's estate. In any case, penalty and interest which had accrued as of the date of death is allowed as a deduction if it is paid after death from assets of the decedent's estate.

HISTORY

1. Amendment of subsection (a) filed 7-2-81; effective thirtieth day thereafter (Register 81, No. 27).

Note

Note: Authority cited: Section 14740, Revenue and Taxation Code. Reference: Section 13987. Revenue and Taxation Code.