Consequently, if the retained interest is valued at zero, the taxable gift equals the fair market value of the residence. If the retained interest is valued under Code section 7520, its value will be greater than zero, and the gift value is minimized.
As a result, if the remaining stake in the property is assessed at no value, the tax-deductible gift equals the market worth of the residence. If the retained interest is evaluated under Section 7520 of the Internal Revenue Code, its value will exceed zero, resulting in a reduced taxable gift.