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required to reduce the federal estate tax on the
decedent's federal estate tax return to the
smallest amount possible based upon finally
determined federal estate tax values, after
taking into consideration all other items
deducted on the federal estate tax return,
administrative expenses deducted on the estate's
fiduciary income tax returns, other property
passing to the surviving spouse, prior taxable
gifts, the allowable state death tax credit (to
the extent that it does not increase the amount
of death taxes payable to any state), and the
unified credit.
The executors determined that "based on the return as
filed," the value of the QTIP property that was needed to
reduce the estate tax to the smallest amount was "0.00".
On February 2, 1995, respondent issued separate
notices of deficiency to Mrs. Elizabeth Winkler and the
Estate of Emerson Winkler. Respondent determined
deficiencies in Mr. and Mrs. Winkler's gift tax for 1989 in
the amount of $58,596 each. This determination is based on
respondent's findings that Mrs. Winkler made gifts to her
children of 50 percent of the winning Lotto ticket, and
that Mr. Winkler consented to split the gifts pursuant to
section 2513. Respondent determined the value of 50
percent of the winning ticket to be $1,514,014.35 and
therefore increased the value of the total taxable gifts
made by both Mr. and Mrs. Winkler by one-half that amount,
$757,007.17.
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