[WSBAPT] Reporting Gifts Within Three Years on WA Estate Returns

[John J. Sullivan]

Thanks Phil and Chris. 

I concur,  in the end I buried the statement in the continuation sheet to Schedule G and enclosed the Form 709. 

I t irks me a bit to be asked to provide information irrelevant to the return, since the gifts aren’t subject to the three year rule. I suspect the DOR is fishing for data to build a case at the Legislature for adding a gift tax. 

In the end I decided to err on the side of disclosure. No sense making your client look like she’s hiding something she doesn’t need to hide. 

Thanks and have a good weekend. 

John J. Sullivan

Sent from my iPad

> On Aug 31, 2018, at 12:48 PM, Philip N. Jones <pjones at duffykekel.com> wrote:
> 
> We should also note that page 2 of the WA return requires the attachment of all prior gift tax returns.  So this requested information would seem to duplicate some or all of what is on the gift tax returns.
> Why does Washington want this information?  Do they think they will find something taxable?
> Phil Jones
> Portland, OR
>  
> From: wsbapt-bounces at lists.wsbarppt.com [mailto:wsbapt-bounces at lists.wsbarppt.com] On Behalf Of Christopher Small
> Sent: Friday, August 31, 2018 12:35 PM
> To: WSBA Probate & Trust Listserv <wsbapt at lists.wsbarppt.com>
> Subject: Re: [WSBAPT] Reporting Gifts Within Three Years on WA Estate Returns
>  
> John:
>  
> The way I read the instructions, Section G is to only contain those transfers outlined above (in parts 1-5). Because your gifts do not fit any of those descriptions, I'd include it on a separate sheet as instructed (my italics and emphasis below):
>  
> All transfers (other than outright transfers not in trust and bonafide sales) made by the decedent at any time during life must be reported on the schedule regardless of whether you believe the transfers are subject to tax. If the decedent made any transfers not described in the instructions above, the transfers should not be shown on Schedule G. Instead, attach a statement describing these transfers: list the date of the transfer, the amount or value of the transferred property, and the type of transfer.
>  
> Hopefully this helps!
>  
> Cheers,
> 
> Christopher Small
> CMS Law Firm LLC
> 150 Lake St. S., Suite 218
> Kirkland, WA 98033
> 206.659.1512
>  
>  
> Legal stuff I have to put in... To ensure compliance with Treasury Department and IRS regulations, we inform you that, unless expressly indicated otherwise, any federal tax advice contained in this communication (including any attachments) is not intended or written by CMS Law Firm LLC to be used, and cannot be used by the taxpayer, for the purpose of: (i) avoiding penalties that may be imposed on the taxpayer under the Internal Revenue Code; or (ii) promoting, marketing, or recommending to another party any transaction or matter addressed herein (or any attachments).
>  
> On Fri, Aug 31, 2018 at 12:14 PM, John J. Sullivan <sullaw at comcast.net> wrote:
> Listmates:
> 
> I’m working on a WA estate tax return where sizable completed cash gifts were made shortly before death from an RLT and I filed a Form 709 reporting them to the IRS. 
> 
> I’m confident they are not drawn back into the gross estate by Sections 2035 and 2038. But the instructions to the WA return have me wondering whether the DOR is demanding them and the Form 709 anyway. Maybe I’m reading too much into the language. It’s on p. 15 of the instructions, regarding Schedule G. 
> 
> Has anyone dealt with a WA return with sizable pre-morten gifts?
> 
> Thanks,
> 
> John J. Sullivan
> 
> Sent from my iPhone
> 
> 
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