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for decision is whether a transaction in which Mary D. Maggos’
shares of stock in a family-owned company were redeemed
constitutes a taxable gift by Mary D. Maggos for purposes of
section 2512.1
FINDINGS OF FACT
Some of the facts have been stipulated and are so found.
The original petition in this case was filed on behalf of Mary D.
Maggos, who at the time resided in Honolulu, Hawaii. Mary D.
Maggos (decedent) died on September 3, 1996, at the age of 89.
During 1987, Pepsi-Cola Alton Bottling, Inc. (PCAB), was an
Illinois corporation engaged in the business of operating a
Pepsi-Cola bottling franchise in southwestern Illinois
(hereinafter the franchise). The franchise was initially
acquired in 1936 by decedent’s husband, Gust Maggos. The
franchise was subsequently incorporated as PCAB. Until his death
in June 1954, Gust Maggos supervised and directed the business
affairs of PCAB on a day-to-day basis. During the course of
their marriage, Gust and decedent had two children, Nikita Maggos
and Catherine M. Adkins. Subsequent to Gust Maggos’ death,
Nikita Maggos assumed control of the business on a day-to-day
1Unless otherwise indicated, all section references are to
the Internal Revenue Code in effect for the year in issue, and
all Rule references are to the Tax Court Rules of Practice and
Procedure.
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Last modified: May 25, 2011