Washington Law Review


Much comment has followed the recent decision of the Court of Appeals for the 7th Circuit in Kieckhefer v. Commissioner, with some encouragement for persons contemplating gifts in trust for minor children. The spectacular nature of the trust instrument in this case and the outspoken refusal of the Tax Court to accept the type of trust involved, at least for tax purposes, furnishes an occasion to reconsider the relative merits of a trust and a guardianship as a receptacle for gifts for the benefit of minor children. While the donor of gifts to minor children has had a difficult time escaping tax liability in recent years in the income and death tax field, these liabilities have become "relatively" crystallized. The judicial analysis of the Kieckhefer "trust" focuses attention upon the problems of the trust donor in the gift tax field. Its provisions reflect an attempt of the donor to avoid liability not only for income, estate, and inheritance taxes, but also for gift tax by taking advantage of the annual exclusion provisions of the law.

First Page