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death. At some time during September 1996, Albert and Loretta
entered into an option contract, which provided in part that
Albert agreed that Loretta may purchase sufficient shares of MBI
from Albert to make Loretta and Albert equal shareholders if any
of Loretta's children obtain a license to practice mortuary
science within 6 years from the date of the agreement. On or
about December 31, 1996, MBI redeemed 41 shares from Loretta, and
she retained 28.5 shares.
OPINION
Respondent determined that decedent's transfers of MBI stock
to Gayle, Loretta, and Cheryl were, in substance, indirect
transfers of additional shares to Albert, Gregory, and James,
respectively. Respondent contends that decedent transferred the
MBI stock through Gayle, Loretta, and Cheryl to Albert, Gregory,
and James, respectively, for the purpose of obtaining additional
annual gift tax exclusions.
Petitioner asserts that decedent's transfers of MBI stock to
Gayle, Loretta, and Cheryl were, both in form and substance,
transfers only to Gayle, Loretta, and Cheryl.
Respondent's determinations of fact are presumptively
correct, and petitioner bears the burden of proving by a
preponderance of the evidence that those determinations are
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