Wills, Trusts & Estates Prof Blog

Editor: Gerry W. Beyer
Texas Tech Univ. School of Law

Monday, November 19, 2012

IRS Nonacquiescence in the Wandry Case

IRS 2As I have previously discussed, the Internal Revenue Service (IRS) withdrew its appeal to the Tenth Circuit Court of Appeals in Wandry v.Comm'r. In Wandry, the tax court held that the use of a formula gift clause was an appropriate method to avoid an inadvertent gift tax on property that could be re-evaluated by the IRS to exceed the amount that was gifted. Recently, the IRS has released Internal Revenue Bulletin: 2012-46. In the bulletin, the IRS explained that the Service does not acquiesce in the decision in Wandry. This means that the IRS commissioner does not agree with the decision the court and will not follow the ruling in cases that involve other taxpayers nationwide. However, there is one exception to this in that the "Service will recognize the precedential impact of the opinion on cases arising within the venue of the of deciding circuit."

See Internal Revenue Bulletin 2012-46, IRS, Nov. 13, 2012.

Special thanks to Brian Cohan (Attorney at Law, Law Offices of Brian J. Cohan, P.C.) for bringing this article to my attention.


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Apparently the Service is not going to relent despite the consistent pounding it receives on this issue. I think that most of us in the trenches are presuming, perhaps to our detriment, that the Service will at least stop pestering those with formula gift clauses with charity spill overs such as the ones blessed in Christiansen and Estate of Petter.

Posted by: brian j. cohan | Dec 14, 2012 6:33:02 AM

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