How Is the Donee's Basis Calculated for the Gift of Appreciated

question 239

Essay

How is the donee's basis calculated for the gift of appreciated property for a gift made before 1977? Assume the donor pays gift tax.

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Definitions:

Payment

The transfer of money or goods from one party to another as an exchange for goods, services, or to fulfill a legal obligation.

UCC Article 9

A provision of the Uniform Commercial Code that governs secured transactions involving personal property, outlining the process for creating and enforcing security interests.

Writing Requirement

A legal stipulation that certain contracts or agreements must be documented in writing to be enforceable.

Implied Warranty

A legal assumption in commerce that the goods or services sold meet certain quality standards, even if not explicitly stated by the seller.