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right of survivorship created by the deeds under California
law.
Held, further: To deal with the inherent
characteristics of joint tenancy with right of survivorship,
sec. 2031, I.R.C., and sec. 2040, I.R.C., provide an
explicit approach to valuing joint tenancy. Fractional
interest discounts and lack of marketability discounts are
inapplicable to the valuation of joint tenancy under sec.
2040(a), I.R.C.
Held, further: P is liable for the addition to tax for
late filing under sec. 6651(a), I.R.C.
Lance M. Weagant and Randall D. Fowler, for petitioner.
Dwight M. Montgomery, for respondent.
WRIGHT, Judge: Respondent determined a deficiency of
$154,545 in petitioner's Federal estate tax and an addition to
tax under section 6651(a)1 in the amount of $38,636. After
concessions by the parties, the issues remaining are:
(1) Whether decedent's property interest in the Young
Property was an interest in joint tenancy or in community
property. We hold that decedent held the property in joint
tenancy.
(2) Whether a fractional interest discount or a lack of
marketability discount is applicable to the Young Property. We
hold that a discount is inapplicable.
1 All section references are to the Internal Revenue Code
in effect for the year in issue, and all Rule references are to
the Tax Court Rules of Practice and Procedure, unless otherwise
indicated.
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