Failure to Report a Taxable Gift Does Not Create A Cascade of Problems in Subsequent Gift Tax Returns

Fredrick P. Niemann, Esq. of Hanlon Niemann & Wright, a Freehold, NJ Estate Administration & Probate Attorney

The following post I received from my friends at Garden State Trust which I thought you would be interested in. The subject is filing a gift tax return and the consequences of not filing a return. Generally you do not have to file a gift tax return unless you make a taxable gift. That’s really hard to do now with a federal gift tax exemption amount of over $5 million.

But in this case it appears a taxpayer made a substantial taxable gift many years ago, but never filed a gift tax return. The IRS can assess a gift tax at any time, in any subsequent year, because the statute of limitations never begins to run when no gift tax return is filed. In this case the taxpayer learned this lesson the hard way, when he had to pay a gift tax on a transfer made 40 years earlier. Normally, the IRS has only three years in which to challenge a gift tax return. That’s the statute of limitations imposed upon the IRS to challenge any taxable gifts when a gift tax return is filed.

It appears that years later the taxpayer reported a large taxable gift. In calculating the amount of gift tax due, he omitted the prior year’s transfer, and therefor, paid less gift tax than he should have. Is that a substantial omission, which would double the limitations period to six years? It is not, the IRS ruled recently. The substantial omission must be with respect to transfers made for the period covered by the gift tax return. It would take a legislative fix to close this gap, the IRS concluded.

To discuss your NJ Estate & Probate Administration matter, please contact Fredrick P. Niemann, Esq. toll-free at (855) 376-5291 or email him at  Please ask us about our video conferencing consultations if you are unable to come to our office.

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ABA group will publish article calling Trump a ‘libel bully’


ABA logo.

The ABA Forum on Communications Law will publish an article calling Donald Trump a “libel bully” despite reservations about partisan language cited by an ABA official.

In a statement on Friday, the ABA said the forum will publish the article next week.

“To be clear, the ABA did not refuse to publish the article,” the statement said. “After the article was first submitted for publication, ABA staff suggested some edits to the article that were in keeping with the ABA’s commitment to non-partisanship. The author did not discuss the editing suggestions with ABA staff and instead withdrew her article for publication.”

The author resubmitted her article to the forum and it was accepted, the ABA statement said.

ABA policy gives its entities the right to publish their newsletters without higher-level authorization, according to the statement. It adds that there has been “inaccurate media coverage” about the controversy.

Some media reports had claimed the ABA pulled the article because of a fear of being sued.

The article by First Amendment lawyer Susan Seager examines seven libel cases filed by Trump. Four were dismissed on the merits, two were voluntarily withdrawn, and one was a default win in an arbitration in which a former Miss Pennsylvania failed to appear.

Seager told the ABA Journal earlier this week that she believed an email expressing concerns by ABA deputy executive director James Dimos was a message that a battle over suggested edits had been lost.

In the email to a forum editor, James Dimos expressed concern about the “tone” of the article and included suggested edits. Dimos’ email also raised the possibility of a Trump lawsuit, though Dimos said he didn’t think such a suit would have merit.

Dimos’ suggestions had included cutting the first paragraph of the article, which read: “Donald J. Trump is a libel bully. Like most bullies, he’s also a loser, to borrow from Trump’s vocabulary.”

Dimos also suggested changing the article headline, which read “Donald J. Trump Is a Libel Bully but Also a Libel Loser.” Dimos suggested changing it to read “Presidential Election Demonstrates Need for Anti-Slapp Laws.” The reference was to laws that fight so-called strategic lawsuits against public participation. The laws allow early dismissal of libel suits and recovery of the defendant’s legal fees.

The ABA statement says the ABA has long-standing policy that encourages adoption of Anti-SLAPPlaws. “Hopefully, this matter will shine a light on the problem of frivolous lawsuits that turn the justice system into a weapon that has a chilling effect on free speech,” the statement said.

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Transgender teen’s bathroom lawsuit will get Supreme Court review

U.S. Supreme Court

Transgender bathroom sign.

The U.S. Supreme Court has agreed to consider the case of a transgender teen who claims his high school’s ban on his use of the boys’ restroom violates federal law.

The Supreme Court on Friday agreed to hear the case, which challenges the restroom policy at the school in Gloucester County, Virginia, report the Washington Post and the New York Times. The SCOTUSblog case page is here and a SCOTUSblog report on the cert petition is here.

The 17-year-old teen, Gavin Grimm, identifies as male. He alleges the restroom policy violates Title IX, the federal law that bars schools that receive federal funds from discriminating on the basis of sex.

A federal judge had tossed Grimm’s Title IX claim but the Richmond, Virginia-based 4th U.S. Circuit Court of Appeals reinstated the claim in April. The appeals court cited federal regulations that interpret Title IX to require schools to treat transgender students consistent with their gender identity.

The school board’s cert petition (PDF) had argued the case is not really about whether Grimm should be allowed to access the boys’ restroom, or even primarily about the proper interpretation of Title IX. Instead, the cert petition said, the case is about whether a federal agency can require schools to treat transgender students consistent with their gender identity “in a piece of private correspondence.”

The case is Gloucester County School Board v. G.C.

Related articles: “Supreme Court stay in transgender teen’s case allows school to enforce restroom restriction” “Transgender teen may sue over school’s restroom restriction, 4th Circuit says” “US tells schools to allow transgender students to use facilities matching their gender identity”

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Northern Ireland judge rejects legal challenges to Brexit

International Law

UK and Ireland.

A judge in Northern Ireland has turned aside two of the first legal challenges to the United Kingdom leaving the European Union.

According to The Guardian, Justice Paul Maguire, a High Court Judge in Northern Ireland, ruled Friday that the court lacked the power to stop the government from triggering Article 50 of the Lisbon Treaty, which signatories must invoke if they wish to leave the European Union.

Maguire dismissed two challenges to the Brexit process: a case brought by man who lost a son during the Troubles who argued that, because Northern Ireland voted to remain, its devolved parliament should have the right to vote on whether or not it wants to leave the EU; and a separate case brought by politicians arguing that Northern Ireland should be exempt from the Brexit.

The Troubles was a period of political unrest and violence in Northern Ireland following the Bloody Sunday massacre of protesters by British soldiers in 1968, and it was ended by the signing of the Good Friday Agreement (also known as the Belfast Agreement) in 1998. Among the elements of the treaty were the disarming of paramilitary groups; the establishment of the Northern Ireland Assembly; a relaxing of border restrictions between Northern Ireland and the Republic of Ireland; and agreement by Great Britain to abide by the European Convention of Human Rights in Northern Ireland. The people of Northern Ireland were also given the right to both British and Irish citizenship. An earlier article in the Telegraph goes into detail about how Brexit could complicate enforcement of the terms agreed to in the Good Friday Agreement.

Maguire stated that the Good Friday Agreement could not be used to block the Brexit, stating that the treaty only dealt with the question of whether “Northern Ireland should remain as part of the UK or unite with Ireland.”

According to Maguire, there are currently additional legal challenges to Brexit pending in English courts. He made clear that his rulings would not affect those cases while acknowledging that he would not have the final word as to how Brexit would affect Northern Ireland. “While the wind of change may be about to blow, the precise direction in which it will blow cannot yet be determined, so there is a level of uncertainty, as evidenced by the discussion about how the Northern Ireland land border with Ireland was affected by withdrawal from the EU,” Maguire wrote. According to Bloomberg, both cases can be appealed to the U.K. Supreme Court.

“We welcome the court’s judgment, which agrees with us that the government can proceed to trigger Article 50 as planned,” said a spokesperson for the government. “We will now await the outcome of the parallel cases under consideration by the England and Wales high court before setting out our next steps.”

Raymond McCord, who brought one of the Brexit cases before the court and whose son was murdered by loyalist paramilitaries in 1997, said that he was disappointed with the result and vowed to continue with his legal challenge to the Brexit. “We live in a democratic system,” he said. “Fifty-six percent of the people of this country voted to remain.”

In the referendum on whether the U.K. should leave the European Union, 56 percent of Northern Ireland residents voted to stay, compared to 48 percent of voters overall, according to the BBC.

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Indicted judicial candidate says she wouldn’t take bench until ethics case is resolved


Robes and a gavel.

The former staff attorney/law clerk facing an indictment for allegedly impersonating an Illinois judge says she won’t take the bench, if she wins election, until an ethics case against her is resolved.

Rhonda Crawford said in a court filing that she would not oppose an order that would bar her from taking the bench until resolution of the ethics case, the Chicago Tribune reports.

Crawford was indicted earlier this month on a felony charge of official misconduct and a misdemeanor charge of false impersonation. She is accused of donning judicial robes and ruling in traffic court cases in August as part of a shadowing process. Crawford has said she was always under direction of the judge.

Crawford is seeking extra time to respond to the ethics case, which seeks to bar her from becoming a judge if she wins the Cook County judicial election. Crawford said the lawyer most familiar with the ethics case recently died, and she has hired new lawyers.

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