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A bequest is the act of giving property by will.^[1] Strictly, "bequest" is used of personal property, and "devise" of real property. It means the same thing as bequeath in legal terminology.

(From Old English becwethan, to declare or express in words; cf. "quoth")

Part of the process of probate involves interpreting the instructions in a will. It means the same thing as bequeath in legal terminology.

Some wordings that define the scope of a bequest have specific interpretations. "All the estate I own" would involve all of the decedent's possessions at the moment of death.^[2]

A conditional bequest is a bequest which will only be granted if a particular event has occurred by the time of its operation. For example, a testator might write in their will that "Mary will receive the house held in trust if she is married" or "...if she has children," etc.

An executory bequest is a bequest which will be granted when a particular event occurs in the future, if it happens. For example, a testator might write in their will that "Mary will receive the house held in trust set when she marries" or "when she has children," etc.

In microeconomics theorists have engaged the issue of bequest from the perspective of consumption theory, in which they seek to explain the phenomenon in terms of a bequest motive.

This article or section deals primarily with the United States and does not represent a worldwide view of the subject. Please improve this article or discuss the issue on the talk page.

For the Recipient

In order to calculate a taxpayer's income tax obligation, the gross income of the tax payer must be determined. Under Section 61 of the Internal Revenue Code gross income is "all income from whatever source derived".^[3] On its face, the receipt of a bequest would seemingly fall within gross income and thus be subject to tax. However, in other sections of the code, exceptions are made for a variety of things that do not need to be included in gross income. Section 102(a) of the Code makes an exception for bequests stating that "Gross income does not include the value of property acquired by gift, bequest, or inheritance." ^[4] In general this means that the value or amount of the bequest does not need to be included in a taxpayer's gross income. This rule is not exclusive, however, and there are some exceptions under Section 102(b) of the code where the amount of value must be included.^[5] There is great debate amount whether or not bequests should be included in gross income and subject to income taxes, however there has been some type of exclusion for bequests in every Federal Income Tax Act.^[6]

For the Donor

One reason that the recipient of a bequest is usually not taxed on the bequest is because the donor may be taxed on it. Donors of bequests may be taxed in through other mechanisms such as federal wealth transfer taxes.^[7] Wealth Transfer taxes, however, are usually only imposed against the very wealthy. ^[8]

• This article incorporates text from the Encyclopædia Britannica Eleventh Edition, a publication now in the public domain.

1. ^ Black's Law Dictionary 8th ed, (West Group, 2004)
2. ^ law.com Law Dictionary: all the estate I own
3. ^ http://www.law.cornell.edu/uscode/search/display.html?terms=61&url=/uscode/html/uscode26/usc_sec_26_00000061----000-.html
4. ^ http://www.law.cornell.edu/uscode/search/display.html?terms=gifts%20and%20inheritances&url=/uscode/html/uscode26/usc_sec_26_00000102----000-.html
5. ^ http://www.law.cornell.edu/uscode/search/display.html?terms=gifts%20and%20inheritances&url=/uscode/html/uscode26/usc_sec_26_00000102----000-.html
6. ^ Samuel A. Donaldson (2007). Federal Income Taxation of Individuals: Cases, Problems and Materials, 2nd Edition, St. Paul: Thomson/West, 93
7. ^ Samuel A. Donaldson (2007). Federal Income Taxation of Individuals: Cases, Problems and Materials, 2nd Edition, St. Paul: Thomson/West, 93
8. ^ Samuel A. Donaldson (2007). Federal Income Taxation of Individuals: Cases, Problems and Materials, 2nd Edition, St. Paul: Thomson/West, 93

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