Hyperlocal Gift Economies Under the Duberstein Gift Standard

Nicolás R. Munsen*

Hyperlocal gift economies, such as those moderated by the “Buy Nothing Project,” have become increasingly popular in the United States and abroad within the last decade. Explicitly banning the buying, selling, trading, or bartering of goods and services, hyperlocal gift economies instead encourage local community members to give to each other out of their own abundance and without any expectation of return or obligation—in short, to give and receive gifts. But while members of these groups regard these transactions as gifts, it is unclear if the Internal Revenue Service would agree. The Internal Revenue Code’s definition of “gift” in I.R.C. § 102, as interpreted by Commissioner v. Duberstein, stipulates that a transfer of goods or services qualifies as a gift only if it is made with “detached and disinterested generosity” and “out of affection, respect, admiration, charity or like impulses.” Later applications of the Duberstein standard, such as the holding in Olk v. United States that a “toke” to a dealer in a casino is not a gift, make clear that courts are willing to give great weight to the surrounding context of a transaction in determining the intent of the giver. And if a tip to a dealer cannot be the product of “detached and disinterested generosity” due to the surrounding context of the giving (the gift is to a dealer, a person from whom one has or hopes to hear news of great self-interest), one might also conclude that giving to a group from which one reasonably expects to receive disqualifies the giving from being a “gift,” and that transfers within a hyperlocal gift economy are therefore not gifts per se. This Note disagrees with that conclusion. A thorough review of relevant caselaw and tax policy principles leads me to argue that, so long as participants abide by the guidelines established by the Buy Nothing Project (or comparable guidelines established by a similar group), transactions in hyperlocal gift economies do not and should not fall outside of the Duberstein standard.

*J.D. Candidate, Notre Dame Law School, 2025.  Many thanks to Professor Michael Kirsch for sparking my interest in tax law and for his insight and guidance on this topic; to the members of the Notre Dame Law Review for their generous expenditure of time, skill, and care in editing this piece; and to my family, for their unflagging support of my endeavors. This piece is dedicated to my wife, Morgan Munsen, whose commitment to living an ethical life inspired this work, and to my father, Randal Munsen, who taught me to love education and to see study as a form of prayer.  Ad Majorem Dei Gloriam.