100 STAT. 2724
PUBLIC LAW 99-514—OCT. 22, 1986 "(A) IN GENERAL.—Except as provided in subparagraph (B), any nontaxable gift which is not a direct skip and which is made to a trust shall not be taken into account under subsection (a)(2)(B). "(B) DETERMINATION OF 1ST TRANSFER TO TRUST.—In the
case of any nontaxable gift referred to in subparagraph (A) which is the 1st transfer to the trust, the inclusion ratio for such trust shall be zero. "(3) NONTAXABLE GIFT.—For purposes of this section, the term 'nontaxable gift' means any transfer of property to the extent such transfer is not treated as a taxable gift by reason of— "(A) section 2503(b) (taking into account the application of section 2513), or "(B) section 2503(e). "(d) SPECIAL RULES WHERE MORE THAN 1 TRANSFER MADE TO TRUST.—
"(1) IN GENERAL.—If a transfer of property (other than a nontaxable gift) is made to a trust in existence before such transfer, the applicable fraction for such trust shall be recomputed as of the time of such transfer in the manner provided in paragraph (2). "(2) APPLICABLE FRACTION.—In the case of any such transfer, the recomputed applicable fraction is a fraction— "(A) the numerator of which is the sum of— "(i) the amount of the GST exemption allocated to property involved in such transfer, plus "(ii) the nontax portion of such trust immediately before such transfer, and "(B) the denominator of which is the sum of— "(i) the value of the property involved in such transfer, reduced by any charitable deduction allowed under section 2055 or 2522 with respect to such property, and "(ii) the value of all of the property in the trust (immediately before such transfer). "(3) NONTAX PORTION.—For purposes of paragraph (2), the
term 'nontax portion' means the product of— "(A) the value of all of the property in the trust, and "(B) the applicable fraction in effect for such trust. "(4) SIMILAR RECOMPUTATION IN CASE OF CERTAIN LATE ALLOCATIONS.—If^
"(A) any allocation of the GST exemption to property transferred to a trust is not made on a timely filed gift tax return required by section 6019, and "(B) there was a previous allocation with respect to property transferred to such trust, the applicable fraction for such trust shall be recomputed as of the time of such allocation under rules similar to the rules of paragraph (2).
"Subchapter F—Other Definitions and Special Rules "Sec. "Sec. "Sec. "Sec.
2651. 2652. 2653. 2654.
Generation assignment. Other definitions. Taxation of multiple skips. Special rules.