If IRD is transferred to an heir or trust in fulfillment of a pecuniary gift (a gift of a fixed dollar amount) as opposed to a fractional gift or a residuary bequest
, the transfer is treated as a "sale" of the benefits, causing immediate realization of income to the funding trust (the transferor).
1 million charitable deduction--the amount of the residuary bequest
to the two schools.
Disclaimer of residuary bequest resulted in disclaimant's inheritance under intestacy law.
In Letter Ruling (TAM) 9417002,(38) the decedent's daughter disclaimed her residuary bequest, believing that the disclaimed property would then pass to her children.
D to partially fund a "true worth" formula pecuniary bequest rather than a residuary bequest
would produce essentially the same results as under the Sec.
However, the will required estate taxes to be charged against the residuary bequests
without adjustment among the beneficiaries.