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intermediate transferees); Schultz v. United States, 493 F.2d
1225 (4th Cir. 1974)(applying essentially a substance over form
analysis to reciprocal gifts); Griffin v. United States, 42 F.
Supp. 2d 700 (W.D. Tex. 1998)(discussing the lack of business
purpose inherent in gifts, and then applying economic substance
analysis to a gift of stock).
Generally, the economic substance doctrine, with its
emphasis on business purpose, is not a good fit in a tax regime
dealing with typically donative transfers. Business purpose will
oftentimes be suspect in these transactions because estate
planning usually focuses on tax minimization and involves the
transfer of assets to family members. If taxpayers, however, are
willing to burden their property with binding legal restrictions
that, in fact, reduce the value of such property, we cannot
disregard such restrictions. To do so would be to disregard
economic reality.
WELLS, C.J., agrees with this concurring opinion.
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