Linton Reversed: Indirect Gift and the Step Transaction Doctrine

Abstract

The Ninth Circuit recently reversed the district court’s summary judgment in favor of the government in Linton on the issues of indirect gift and the applicability of the step transaction doctrine. The circuit court’s analysis focused on the taxpayers’ donative intent. With that emphasis, the Ninth Circuit remanded the case to the district court to determine the sequence of the relevant transactions.

Keywords: gift tax, FLP, family limited partnership, step transaction, indirect gift, Linton

JEL Classification: H20, K34