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Kerr Family Limited Partnership
On December 31, 1993, petitioners and the Kerr children
executed an agreement forming the Kerr Family Limited Partnership
(KFLP) under the Texas Revised Limited Partnership Act (TRLPA),
Tex. Rev. Civ. Stat. Ann. art. 6132a-1 (West Supp. 1993).
Petitioners made all capital contributions to KFLP in the form of
three life insurance policies on their lives with a face amount
totaling approximately $7 million. The Kerr children did not make
any capital contributions to KFLP.
At the time KFLP was formed, petitioners were the sole general
partners. However, petitioners immediately assigned a portion of
their general partnership interest to each of the Kerr children.
In particular, each of the Kerr children received a .2325-percent
KFLP general partnership interest. There is no evidence in the
record that petitioners executed a written consent admitting the
Kerr children as general partners of KFLP.
Following the transfers described above, petitioners retained
the following partnership interests in KFLP: (1) A combined 100-
percent class A limited partnership interest;6 (2) a combined 2-
6 Pursuant to sec. 5.01 of the KFLP partnership agreement,
class A limited partners were entitled to an annual guaranteed
payment.
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Last modified: May 25, 2011