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v. Commissioner, 105 T.C. 71, 81-85 (1995).
We are mindful that a vital component of due process is that
a statute be "reasonably clear". See Smith v. Goguen, 415 U.S.
566, 572 (1974); Grayned v. City of Rockford, 408 U.S. 104,
108-109 (1972); Retired Teachers Legal Defense Fund, Inc. v.
Commissioner, 78 T.C. 280, 284-285 (1982). We conclude that
section 845(b) passes that test. As will be reflected in the
following discussion, the term "significant tax avoidance effect"
has a discernible meaning taking into account the relevant
legislative history and other aids to its interpretation.
3. Significant Tax Avoidance Effect
Respondent determined that the Agreements had a significant
tax avoidance effect with respect to petitioner. Respondent
argues that the Agreements did not transfer life insurance risk
to petitioner that was proportionate to the benefit it derived
from the small life insurance company deduction. Respondent
relies primarily upon the testimony of her three experts,
Ralph J. Sayre, Jack M. Turnquist, and Charles M. Beardsley.
Mr. Sayre is a consulting actuary for Actuarial Resources of
Georgia, and he is a member of various actuarial societies.
Mr. Turnquist is a member of various actuarial organizations, and
he has been self-employed since 1987, providing consulting
services on actuarial and technical communications relative to
the operation of life insurance companies. Mr. Beardsley is an
actuary, and he is an expert on the annual statement reporting
for insurance companies.
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