26 U.S.C. § 2001 - Imposition and rate of tax

26 USC 2001 - Imposition and rate of tax

(a) Imposition 
A tax is hereby imposed on the transfer of the taxable estate of every decedent who is a citizen or resident of the United States.
(b) Computation of tax 
The tax imposed by this section shall be the amount equal to the excess (if any) of
(1) a tentative tax computed under subsection (c) on the sum of
(A) the amount of the taxable estate, and
(B) the amount of the adjusted taxable gifts, over
(2) the aggregate amount of tax which would have been payable under chapter 12 with respect to gifts made by the decedent after December 31, 1976, if the provisions of subsection (c) (as in effect at the decedents death) had been applicable at the time of such gifts.

For purposes of paragraph (1)(B), the term adjusted taxable gifts means the total amount of the taxable gifts (within the meaning of section 2503) made by the decedent after December 31, 1976, other than gifts which are includible in the gross estate of the decedent.

(c) Rate schedule 

(1) In general 
(2) Phasedown of maximum rate of tax 

(A) In general 
In the case of estates of decedents dying, and gifts made, in calendar years after 2002 and before 2010, the tentative tax under this subsection shall be determined by using a table prescribed by the Secretary (in lieu of using the table contained in paragraph (1)) which is the same as such table; except that
(i) the maximum rate of tax for any calendar year shall be determined in the table under subparagraph (B), and
(ii) the brackets and the amounts setting forth the tax shall be adjusted to the extent necessary to reflect the adjustments under subparagraph (A).
(B) Maximum rate 
The maximum In calendar year: rate is: 2003 49 percent 2004 48 percent 2005 47 percent 2006 46 percent 2007, 2008, and 2009 45 percent.
(d) Adjustment for gift tax paid by spouse 
For purposes of subsection (b)(2), if
(1) the decedent was the donor of any gift one-half of which was considered under section 2513 as made by the decedents spouse, and
(2) the amount of such gift is includible in the gross estate of the decedent,

any tax payable by the spouse under chapter 12 on such gift (as determined under section 2012 (d)) shall be treated as a tax payable with respect to a gift made by the decedent.

(e) Coordination of sections 2513 and 2035 
If
(1) the decedents spouse was the donor of any gift one-half of which was considered under section 2513 as made by the decedent, and
(2) the amount of such gift is includible in the gross estate of the decedents spouse by reason of section 2035,

such gift shall not be included in the adjusted taxable gifts of the decedent for purposes of subsection (b)(1)(B), and the aggregate amount determined under subsection (b)(2) shall be reduced by the amount (if any) determined under subsection (d) which was treated as a tax payable by the decedents spouse with respect to such gift.

(f) Valuation of gifts 

(1) In general 
If the time has expired under section 6501 within which a tax may be assessed under chapter 12 (or under corresponding provisions of prior laws) on
(A) the transfer of property by gift made during a preceding calendar period (as defined in section 2502 (b)); or
(B) an increase in taxable gifts required under section 2701 (d),

the value thereof shall, for purposes of computing the tax under this chapter, be the value as finally determined for purposes of chapter 12.

(2) Final determination 
For purposes of paragraph (1), a value shall be treated as finally determined for purposes of chapter 12 if
(A) the value is shown on a return under such chapter and such value is not contested by the Secretary before the expiration of the time referred to in paragraph (1) with respect to such return;
(B) in a case not described in subparagraph (A), the value is specified by the Secretary and such value is not timely contested by the taxpayer; or
(C) the value is determined by a court or pursuant to a settlement agreement with the Secretary.

For purposes of subparagraph (A), the value of an item shall be treated as shown on a return if the item is disclosed in the return, or in a statement attached to the return, in a manner adequate to apprise the Secretary of the nature of such item.