Betty Haley and Jerry Filpi have lived together for over 3 years. They are not married but tend to pool their money to pay bills, buy groceries, etc. Thinking of a better life, Betty used the pooled funds to buy a lottery ticket and won $4.2 million. The lottery commission told them the payout could be to only one person, so they executed a “separate ownership agreement” which provided an equal interest for each of them in the ticket. Will Betty be required to pay gift tax on the transfer of a one-half interest in the ticket to Jerry?

Your solution should be based on a Letter Ruling or TAM which should be cited in your response.