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Unless otherwise indicated, all section references are to
the Internal Revenue Code as in effect during 1980, and all Rule
references are to the Tax Court Rules of Practice and Procedure.
Respondent determined a gift tax deficiency for the estate
of Birnie M. Davenport on the ground that Birnie M. Davenport
(Birnie) made taxable gifts in 1980 of shares of stock in Hondo
Drilling Co., Inc. (Hondo). Respondent also determined a
deficiency in petitioner's estate tax due to an increase in
adjusted taxable gifts made in previous years.1
The primary issues for decision are:
(1) Whether Birnie owned stock of Hondo during her
lifetime; and if so,
(2) whether Birnie transferred stock of Hondo to Gordon
Davenport, Patricia Vestal, and Charles Botefuhr in July of 1980;
and if so,
(3) whether Birnie's transfer of Hondo stock in July of
1980 constituted a gift for Federal gift tax purposes;
(4) whether the 1980 Federal gift tax return filed by the
Estate of Birnie M. Davenport was delinquently filed; and
(5) whether the period of limitations for assessing a gift
tax deficiency in this case has expired.
1 The cases involving the estate tax and the gift tax
deficiencies were consolidated for purposes of trial, briefing,
and opinion. The parties do not address the estate tax
deficiency on brief. We assume, therefore, that the parties
agree that our resolution of the gift tax issue will also resolve
the estate tax deficiency.
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