115 T.C. No. 2
UNITED STATES TAX COURT
WILLIAM A. AND GAYLE T. COOK, DONORS, Petitioners v.
COMMISSIONER OF INTERNAL REVENUE, Respondent
Docket No. 257-99. Filed July 25, 2000.
H and W, husband and wife, each created two trusts
intended to qualify as grantor retained annuity trusts
(GRAT’s) under sec. 2702, I.R.C. The grantor in each
trust retained an annuity for a stated number of years.
If the grantor dies before the expiration of the stated
term of years and is survived by a spouse, the annuity
continues for the spouse until the earlier of his or
her death or the expiration of an additional specified
term. If the grantor dies before the expiration of the
stated term of years and is not survived by a spouse,
the term of the annuity ends upon the death of the
grantor.
In each trust, the grantor has reserved the power
to revoke the interest of the spouse.
Ps contend that the value of the remainder
interest in each GRAT, of which the grantor made a
taxable gift, is the value of the transfer in trust,
reduced by the actuarially determined value of a dual-
life annuity under sec. 7520, I.R.C. R contends that
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