Madeleine Pickens v. United States

When an individual passes away, the executor of his estate must pay estate taxes. If the executor fails to pay, the Internal Revenue Service may enforce a tax lien that attaches to all estate property, and may impose personal liability on executors. This case involves an additional, extraordinary authority available to the IRS under 26 U.S.C. § 6324(a)(2). That statute provides that if estate taxes are not paid when due, an individual who falls within six statutory categories who receives, or has on the date of the decedent’s death, property included in the gross esdent's tate under sections 2034 to 2042, inclusive, to the extent of the value, at the time of the decedent’s death, of such property, shall be persondent's ally liable for such tax. Id. For nearly 100 years, all three Branches of Government agreed that this provision empowers the IRS to impose personal liability on third parties who have or receive estate property immediately "on“on the date of the decedent’s death,” and who can thus "delay decedent's death," “delay or defeat collection” collection" of estate taxes. Higley v. Comm’r, Comm'r, 69 F.2d 160, 163 (8th Cir. 1934). All three Branches also agreed that Section 6324(a)(2) does not apply to beneficiaries of a trust who receive estate assets after a decedent’s death, and who are not responsible for the discedent's estate’s assets. In the decision below, tribution of the estate's the Ninth Circuit broke with this longstanding consensus and held that Section 6324(a)(2) applies to persons who receive estate property at the date of death or anytime thereafter. (i)