Gift Splitting and Generation-Skipping Transfers
Learn the decision pattern the exam can test, then apply it to a realistic taxpayer fact pattern.
What changes the answer?
Gift splitting is an election with filing consequences, not simply an informal agreement between spouses.
A tax-practice scenario
One spouse gives property to a grandchild and both spouses want to share the gift. Analyze consent, returns, allocation, and GST implications.
Identify the taxpayer, entity, transaction, and tax period first. Write the controlling tests in order, apply only the relevant facts, and keep the reporting result separate from any planning recommendation.
Do not take this shortcut.
Dividing the amount in half without checking eligibility or filing both spouses' required information.
Turn the rule into recall.
Diagram donor, spouse, recipient generation, trust interests, and elections before computing exclusions.
- ExplainState the governing distinction without notes.
- ApplyChange one fact in the scenario and predict the new result.
- RetrieveAnswer an unseen question, then review every option.
Official source and scope
This lesson follows the current PSI content outline and uses the IRS reference below for the underlying tax or practice framework. Always confirm current forms, instructions, thresholds, and effective dates before advising a taxpayer.