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contaminated, affecting its marketability. The other two
properties had been leased to a third party who had developed
them into a shopping center. It appears that the shopping center
properties were the most significant assets held in the QTIP
trust and the only potential source for the payment of the QTIP’s
agreed portion of the estate tax liability. The estate explained
to respondent that because of a depressed real estate market and
for various other reasons these properties were not expected to
“bring a very good price” at that time. On November 15, 1994,
respondent approved a second extension to June 14, 1995.
Thereafter, on September 27, 1995, the QTIP trustee
distributed the two shopping center parcels to decedent’s
beneficiaries as tenants in common, who in turn transferred the
property to the beneficiaries’ respective personal family trusts.
The trustees of the personal family trusts and the beneficiaries
of decedent’s estate are the same persons (the children of
decedent). The personal family trust of each beneficiary was
separate from the two trusts that made up the bulk of the
estate’s assets. The estate’s request for a third extension was
filed and denied during 1995, and in the appeal it was explained
that the service station was under contract whereby it would be
sold, and the transaction was expected to close in about 60 days.
Respondent granted the third extension until June 14, 1996.
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