Transfers Subject to Retained Right to Receive the Income or Designate the Income Beneficiary

Abstract

Section 2036(a)(1) of the Internal Revenue Code' throws back into the decedent's gross estate the value of transferred property if the decedent retained the right to receive the income from the property (a) for his life, (b) for any period not ascertainable without reference to his death (e.g., quarterly, except for the quarter immediately preceding his death), or (c) for any period that does not in fact end before his death (e. g., for ten years, if he dies during this period). This provision also applies if the decedent retained "possession or enjoyment" of the transferred property, thus reaching property that does not produce income in the conventional sense, such as a work of art given to a donee subject to the donor's right to retain it in his home for life or for either of the two other periods specified by section 2036(a) (1) .