- 4 -
filed a timely petition for redetermination (assigned docket No.
1118-98).
Respondent issued separate notices of transferee liability
to petitioners stating that, as transferees, petitioners each are
liable for $1,968,213 (the value of the stock that decedent
transferred to each petitioner) in respect of the estate tax
deficiency of $2,350,071 due from the estate. Petitioners filed
timely petitions for redetermination contesting the notices of
transferee liability.
Petitioners move for partial summary judgment asserting that
they are not liable as transferees as a matter of law.4
Respondent maintains that petitioners are subject to transferee
liability for the Armstrong estate tax deficiency pursuant to
section 6324(a)(2).
Discussion
Summary judgment is intended to expedite litigation and
avoid unnecessary and expensive trials. See Florida Peach Corp.
3(...continued)
The gift tax is imposed on the value of the property transferred
to the donee and does not include the money used to pay the tax.
In contrast, the estate tax base includes the money ultimately
used to pay the estate tax. For gifts made within 3 years of
death, the sec. 2035(c) gross-up rule is designed to eliminate
this disparity between the gift tax and the estate tax.
4 In the event that their motions are denied, petitioners
intend to contest the amount of the estate tax deficiency due
from the estate and the amount of their personal liability.
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