What Is a Gift for Causa Mortis?
In gift causa mortis, personal property is given with the anticipation that the giver will die shortly.
Knowing Gift Causes Mortis
Gift causa mortis only works when the giver dies. This conditional donation is only possible if the giver anticipates death. Because it is the quintessential deathbed present, a gift of causa mortis is also known as the deathbed gift.
The grantor might provide a gift causa mortis (before death) or inter vivos (during their lifetime). Federal estate tax law taxes gifts causa mortis similarly to will-bequeathed gifts. A will transfers an estate to beneficiaries when the testator dies.
Mortis vs. Inter Vivos Gift
An interview gift and a gift causa mortis have two distinct effects. Revocable gifts cause unrevocable inter-vivos donations. After giving the gift, the giver has no property rights and cannot return it. The giver can rescind a gift causa mortis for any cause while living.
Gifts causa mortis are complete at delivery and acceptance, but the beneficiary has the right to keep them only when the giver dies. Donations are irreversible after death. An automatic revocation of the gift, causa mortis, occurs if the giver survives.
Causa mortis gifts are reversible and conditional, unlike inter vivos donations. Their tax consequences differ. The donor can unilaterally rescind a donation causa mortis while living.
If the donor survives the conditions that prompted them to anticipate death, they can cancel the gift. The beneficiary must outlive the giver to get the gift. The recipient’s estate loses ownership if the beneficiary dies before the donor.
Federal estate tax law treats donations causa mortis as granted in a will, distinguishing them from other gifts. Most likely, a gift causa mortis is incomplete until the giver dies. Inter vivos gifts given within three years of death are also subject to federal estate tax.
Conclusion
- A causa mortis gift occurs when someone gives a gift to someone they think will die shortly.
- Unlike a will or gift inter vivos, this gift is revocable by the grantor until death and may have a different tax status.
- “Causa Mortis” comes from Latin, meaning “contemplating death.”
