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Distributions From Garry's Estate to Decedent ..... 16
Expenses Attributable to Decedent's Investment Income . 17
Net Investment Income of Garry's Estate to Which Decedent
Became Entitled During 1979-93 ........... 17
Facts Relating to Petitioner's Primary Position--Existence
of Claimed Family Farm Partnership ......... 18
Facts Relating to Petitioner's Secondary Position--
Use of Decedent's Investment Income To Pay Expenses
of Family Farm; Consideration Received by Decedent for
Any Investment Income Not So Used .......... 21
HEI Receivable ..................... 21
Children's Performance of Services for Family Farm ... 22
Land Bank Loan ..................... 23
Use of Land Bank Loan Proceeds ............. 23
Interest Deductions Claimed by Garry's Estate or Decedent
With Respect to Land Bank Loan ........... 25
Security for Land Bank Loan Included in Decedent's Estate 25
Miscellaneous Facts Relating to Land Bank Loan ..... 27
OPINION
I. Did Decedent Make Taxable Gifts of Investment Income
Received by Garry's Estate During 1979-93? ...... 27
A. Relevance of Decedent's Taxable Gifts to This
Estate Tax Case .................. 29
B. Broad Definition of "Taxable Gift" ......... 31
C. The Parties' Positions--In General ......... 33
D. Petitioner's Primary Argument--Decedent's Transfer
of Investment Income Was a Bona Fide, Ordinary
Business Transaction ............... 39
E. Petitioner's Secondary Argument--Decedent Either
Spent Investment Income on Her Own Expenses
or Received Full Consideration for Any Income
That Benefited Children .............. 48
1. Petitioner's Estate "Accounting" ........ 49
2. Unreliability of Petitioner's Accounting .... 50
3. Petitioner's Accounting Shows That Much of
Decedent's Investment Income Was Spent on
Children's Expenses .............. 52
4. Decedent Did Not Receive Consideration
Claimed by Petitioner for Any Income Not
Used To Pay Farm Expenses ........... 53
5. No Land Bank Loan Payments Were Decedent's
Expenses ................... 56
6. Decedent's Income Was Not Used To Pay Decedent's
Share of Expenses of Any Business Other Than
Family Farm .................. 58
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Last modified: May 25, 2011