- 11 -
The personal representatives had made distributions from the
estate to the residuary beneficiaries in 1990 and 1991. As of
the time of trial, the personal representatives had not made
final distributions from the estate.
OPINION
The question for decision is whether payments in
satisfaction of a surviving spouse’s elective share under Florida
law (the Florida elective share) are distributions of income or
other amounts properly paid or credited or required to be
distributed, secs. 661(a), 662(a); sec. 1.661(a)-2(e), Income Tax
Regs., that carry out the estate’s DNI to the recipient.4
We begin our inquiry by summarizing the issues that bear on
the question, as framed and argued by petitioner and respondent.
Petitioner argues, citing and quoting Ferguson, Freeland, &
Ascher, Federal Income Taxation of Estates, Trusts, and
Beneficiaries, sec. 1.3 at 1:17 (2d ed. 1993 & Supp. 1997)
(Ferguson et al.), that the Florida elective share is not
“subchapter J property”; in petitioner’s view, the Florida
4 By not issuing a timely protective notice of deficiency to
the estate, respondent lost the opportunity for a comprehensive
resolution of the issues in this case in a consolidated
proceeding that would have avoided any potential whipsaw. But
see the provisions for statutory mitigation, secs. 1311-1314,
particularly, sec. 1312(5); see also sec. 1.1312-5(a)(3), Income
Tax Regs., and transferee liability, sec. 6901(h). As to
petitioner's status as a nontransferee, see John Ownbey Co. v.
Commissioner, 645 F.2d 540, 546 (6th Cir. 1981), revg. T.C. Memo.
1978-482; Stokes v. Commissioner, 22 T.C. 415, 427 (1954).
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011