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reason for concluding that the trust failed to function
exclusively as a CRAT from the date of its creation. See sec.
1.664-1(a)(6), Example (3), Income Tax Regs. (reservation of
power to pay grantor’s debts precludes qualification as CRAT);
see also Rev. Rul. 82-128, 1982-2 C.B. 71 (ruling that “a trust
does not qualify as a charitable remainder trust and no deduction
is allowable under sections 170 and 2522 of the Code if it is
possible that federal estate and state death taxes may be payable
from the trust assets”).
We need not address the valuation of Birchfield’s life
interest and any correlated value of the remainder interest. At
the time the payments were made out of the trusts to and on
behalf of Birchfield, the estate did not qualify for the
exception to section 2055(e)(2)(A) and thus was not entitled to
any charitable deduction for the remainder interest in the trust.
On brief, respondent states that several deductions
previously disallowed will now be allowed, although the
deductions were not identified. At trial, respondent questioned
whether certain expenses were properly deducted due to
uncertainty about whether they had been actually paid. Testimony
about payment of the expense was received in evidence. On brief,
respondent did not address the issue of payment, and,
accordingly, we consider this issue to have been waived or
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