THE LIMITATION OF TAXATION OF TRANSFERS IN CONTEMPLATION OF DEATH BY THE REVENUE ACT OF 1950

The Revenue Act of 1950 amended the estate tax provision dealing with transfers in contemplation of death, which has been on the books ever since the estate tax first appeared as a war emergency measure during World War I, by eliminating from this category all transfers made more than three years prior to the date of death. All transfers made within that period are deemed under the new law to have been made in contemplation of death (and hence are includible in the transferor\u27s gross estate) unless the contrary is shown. Such a rebuttable presumption formerly was limited by the statute to transfers of a material part of the decedent\u27s property made within two years of death. But the prior law furthermore covered all transfers made in contemplation of death at any time. Because of the presumption of correctness which attaches to the ordinary determination made by the Commissioner of Internal Revenue, this meant that the burden of proof was always upon the executor, even with respect to transfers made more than two years prior to death