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needed to live on. She wanted the income, or those
monies for living expenses * * *.
Hillgren’s explanation only underscores the intention to use
the partnership assets to support decedent. Further, it is not
apparent from the record that Hillgren would ever have received a
distribution from LKHP. Overall, the record shows that the
partnership distributions were intended to provide decedent with
her living expenses, further demonstrating that her relationship
to the LKHP properties remained the same after formation of the
partnership and that LKHP should be disregarded for estate tax
purposes.
4. Formality of the LKHP Agreement
Hillgren did not file a certificate of limited partnership
until respondent began examination of the estate’s return.
Striking features of LKHP were the lack of formality surrounding
the partnership, the intention of the parties to keep the
agreement largely invisible, the apparent disregard of the
agreement as situations arose, and the restatements of the
financial affairs by Hillgren and representatives of the estate.
Hillgren and Albrecht took advantage of apparent
inconsistencies in the partnership agreement regarding Hillgren’s
interest when reporting Hillgren’s interest on the estate tax
return and on the partnership tax returns. On the estate tax
return, the estate reported that Hillgren had a 25-percent profit
interest to increase the discount on the estate tax. On the
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