If you choose to transfer your right to income in respect of the decedent to someone else, you must include in your taxable income the lesser of:
The amount you receive for transferring the right, or
The fair market value of the rights at the time your transferred them.
If you give the income you receive in respect of the decedent to someone else as a gift, you must include in your income the fair market value of that right at the time you make the gift.
Type of Income
The type of income you receive in respect of the decedent is the same as it would have been in the decedent’s hands: if it was capital income or ordinary income, it retains the same character for you.