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partnership interests in LKB Associates for purposes of
decedent's gross estate.
Unless otherwise indicated, all section references are to
the Internal Revenue Code in effect as of the date of decedent's
death, and all Rule references are to the Tax Court Rules of
Practice and Procedure.
FINDINGS OF FACT
Some of the facts have been stipulated and are found
accordingly. The stipulation of facts and accompanying exhibits
are incorporated herein by this reference.
The Decedent died testate on April 1, 1992 (valuation date).
Decedent resided in Montgomery County, Maryland. At the time the
petition was filed, Walter G. Kealy, Jr., decedent's personal
representative, resided in Gaithersburg, Maryland.
Decedent and his sister, Marie Louise Kealy, each owned, as
tenants in common, one-half interest in the land located at L
Street, in Washington, D.C. (property). On December 21, 1962,
they agreed to lease the property for 99 years beginning as of
January 1, 1963.
The lease required the lessee to construct any type of
office building or commercial structure having a value of at
least $500,000 in excess of the value of the land, but the
agreement gave the lessee sole discretion in the design and
subsequent demolition of the constructed structure during the
first 69 years of the lease term. Thereafter, the lease required
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