- 42 -
The close identity of funds moving from petitioners to the
Family Trusts and in turn to the CGF and Lincoln Partnerships,19
coupled with the close proximity in time in which this occurred,
suggests that the distribution amounts were intended all along to
be used in the joint investment transactions. We are hard
pressed to believe that the Family Trusts would have agreed to
engage in such transactions without having first received
petitioners' distributions shortly before acquiring their
remainder interests.
Likewise, in Gordon v. Commissioner, supra, there was not
complete identity in the amounts transferred to the trust and the
amount subsequently invested by the trust in the remainder
interest. For example, in one of the tax years at issue,
Dr. Gordon deposited at least $78,141 in the trust's savings
account, and the trust subsequently withdrew $47,592 to purchase
a remainder interest in tax-exempt bonds, while in the next year,
Dr. Gordon deposited at least $58,100 in its savings account, and
the trust withdrew $97,853 to buy its remainder interest. We
were satisfied, however, that "the trust appears to have been
funded for little purpose other than to participate with Dr. Gor-
don in the implementation of his bond acquisition strategy, a
fact that further indicates that Dr. Gordon should be treated as
the true purchaser of the whole bonds." Id. at 329.
19If the after-tax proceeds of the distributions are
compared with the amounts used to purchase the remainder
interests, the numbers should align even more closely.
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