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the remainder value is to be calculated by deducting
the actuarially determined value of a single-life
annuity.
Held: Because the spousal interests in each GRAT
are not fixed and ascertainable at the inception of the
GRAT and are therefore contingent, and because the
retained interests in each GRAT may extend beyond the
shorter of a term of years or the period ending upon
the death of the grantor, the retained interests in the
GRAT’s are to be valued as single-life annuities. See
secs. 25.2702-3(d)(3) and 25.2702-2(a)(5), Gift Tax
Regs.
George N. Harris, Jr., and Juan D. Keller, for petitioners.
Stewart Todd Hittinger, for respondent.
OPINION
NIMS, Judge: This matter is before the Court on the
parties’ cross-motions for partial summary judgment, filed
pursuant to Rule 121. The parties seek a summary adjudication
regarding the same matter; i.e., the proper application of
section 2702 to four grantor retained annuity trusts (GRAT’s).
There is no genuine issue of material fact to preclude a decision
on such matter. We therefore proceed to decide the legal issues
that the parties’ motions present.
Unless otherwise indicated, all section references are to
sections of the Internal Revenue Code, as amended, and all Rule
references are to the Tax Court Rules of Practice and Procedure.
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Last modified: May 25, 2011