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transferred to family limited partnerships established for the
benefit of family members. In Schauerhamer, the children
testified that they intended the decedent’s relationship with the
transferred assets to remain the same after the transfer. Here,
the objective evidence (described above) shows that there was an
implied agreement that the decedent could continue to enjoy the
property, the children did not deny that there was such an
agreement, and we have so found. The decedents in both
Schauerhamer and the instant case commingled funds. Petitioner
cites no significant distinction between Schauerhamer v.
Commissioner, supra, and this case.
4. Whether Interests in the Cameron, San Patricio, Nueces,
and Kleberg Counties Property Held by the Partnership
Are Not Subject to Section 2036 Because Decedent Never
Owned Those Interests
Petitioner contends that Mrs. Reichardt’s interests in the
Cameron, San Patricio, Nueces, and Kleberg Counties property are
not subject to section 2036 because they passed directly from her
estate to the partnership and decedent never owned any interest
in them. We disagree.
The interests in the Cameron, San Patricio, Nueces, and
Kleberg Counties property were Mrs. Reichardt’s separate
property. Under her will, a life interest in that property
vested in decedent under Texas law when Mrs. Reichardt died. See
Tex. Prob. Code Ann. sec. 37 (West Supp. 1999). Decedent’s life
interest included the power to consume all of Mrs. Reichardt’s
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