Argued November 8, 1999; decided December 7, 1999: No. 98-1101
In 1994, Irma Drye died. Under Arkansas law, her $233,000 (USD) estate went to her son Rohn, being her sole heir under mentioned state's laws. Problem is, this fellow owed about $325,000 to the IRS against all of his "property and rights to property." You have to understand this -- under AR law, you can disclaim an inheritance up to 9 months after recieving it. Mr. Drye did so; again, under state law, this sum went to the next closest heir; his daughter Theresa then immediately created the Drye Family Trust, a legally protected non-living entity whose funds were free from government meddling, and could only be distributed to her and her parents for their lifetimes for purposes of their well-being/health/support, at the discretion of Drye's counsel. The question, thus, was whether this inheritance constituted property or a right to property, or was more like a gift which he could (and did) reject.
The case was taken certiorari, meaning that the Supreme Court took it straight from a lower court in the interest of speed of justice (namely, from the Eighth Circuit.) To use an analogy: If you're given a gift by your mom -- say, $100 -- you can accept it, or you can say "No, thanks" and give it back, returning to the status quo (being how things were before the gift.) In an inheritance, however, simply refusing the money/house/two donkeys in southern Spain will not bring the deceased back to life and so the status quo cannot be replaced. The Court found that, though Drye delineated the inheritance to the next-of-kin, it was his property -- which is to say it was the IRS' property. So, in conclusion, you can run, but you can't hide.
This is all original, baby; my sources were Merriam Webster and the Supreme Court's ruling, available at http://supct.law.cornell.edu/supct/html/98-1101.ZS.html among other places (at any other Supreme Court ruling archive, simply enter in 98-1101.)