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Authors

Daze Swift Lee

Abstract

This Note raises taxation issues pertaining to a gift tax on the transfer of property by nonresidents under current United States tax rules. It further illustrates patterns and trends to evade a gift tax using transaction maneuvers. These issues are defined in three categories: a gift tax on the transfer of property situated only within the United States by a nonresident, no gift tax on the transfer of intangible assets, and transferee liability. In response to such issues, this Note calls for corresponding proposals to resolve gift taxation problems. It proposes that a gift tax should be imposed on the transfer of property by a nonresident whether the property is situated inside or outside of the United States. It also proposes that intangible assets transferred by a nonresident should not be exempt from gift taxation. Lastly, this Note proposes that in a gift transaction made by a nonresident, a U.S. donee should be required to withhold a tentative amount of gift tax from the nonresident donor to enhance taxpayer compliance with tax regulations.

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