Also known as: lifetime gifts · inter vivos gift
Written by attorneys · grounded in primary & secondary sources — see below
A voluntary transfer of property made by a donor to a donee without consideration during the donor's lifetime. The transfer takes effect immediately and requires delivery with intent to pass title.
Laura Lewis executed a will leaving her vacation home to her niece Leah Lamb. Two years later Laura transferred the home to Leah by deed and wrote a note stating the transfer should count against the devise. After Laura's death the personal representative treated the transfer as satisfying the devise in full because the contemporaneous writing linked the lifetime gift to the testamentary disposition.
Lars Lindstrom transferred appreciated securities to his daughter Lillian Locke during his lifetime. The IRS later assessed tax on the income generated by the securities after the transfer. The court treated the transaction as a completed lifetime gift that shifted ownership and any future income tax consequences to the donee.
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Lattice Systems made a substantial cash transfer to its principal's spouse shortly before filing for bankruptcy. The trustee argued the transfer was a fraudulent lifetime gift that depleted estate assets. The court examined whether the bankruptcy judge had authority to adjudicate the avoidance claim arising from the pre-petition transfer.
A lifetime gift to a devisee or the devisee's family adeems the devise by satisfaction when the testator provides a contemporaneous writing or the devisee acknowledges in writing that the gift operates as satisfaction.
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The decedent must declare in a contemporaneous writing or the heir must acknowledge in writing that the gift is an advancement or is to be taken into account in distributing the estate.
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A donor making an irrevocable lifetime gift must possess the capacity to make or revoke a will plus the ability to understand the gift's effect on the donor's future financial security and that of any dependents.
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Engagement gifts are often viewed as conditional lifetime gifts given in contemplation of marriage. When the marriage does not occur the donor may recover the property because the condition failed.
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…upholding federal estate taxes imposed, not upon the beneficiary but upon the decedent's estate. A tax upon the donor of an inter vivos gift was held to be an indirect tax in Bromley v. McCaughn , 280 U.S. 124, 135-138, 50 S.Ct. 46, 74 L.Ed. 226 (1929). If a tax on giving property is indirect, so would be a tax on receiving it,…