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Background
Delores E. Lasarzig (decedent) died on March 14, 1993, and
her gross estate primarily consisted of interests in two trusts.
One trust was decedent’s living trust, and the other was a
qualified terminal interest property (QTIP) trust established
under decedent’s predeceased husband’s will. Other than the two
trusts, decedent’s sole assets were those that had been in her
conservatorship estate prior to death. The estate was granted a
6-month extension to June 14, 1994, for payment of the Federal
estate tax. The estate had paid $500,000 with the first request
for extension and estimated that a $3,151,785 estate tax was due.
Because the estate had a $2,735,537 cash shortfall, a second
extension was requested, and, at the time of the request, another
$416,248 in tax plus $14,784 interest was paid. By means of an
October 13, 1994, letter, respondent denied the estate’s request
for a second extension.
The estate administratively appealed respondent’s denial,
explaining that the estate involved two trusts, a family trust
and a QTIP testamentary trust established under decedent’s late
husband’s will. The family trust had paid its portion of the
estate tax, but the QTIP trust was unable to pay currently its
remaining share ($2,700,275). The QTIP trust had sold all of its
assets with the exception of three parcels of realty. One
property, an automobile service station, was chemically
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Last modified: May 25, 2011