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the transfer took place without an objective showing by either of
them that they meant to enforce the payment provisions of the
transfer. To the contrary, the haphazard and, at times,
contradictory manner in which Michael undertook to make payments
to his father falls short of establishing that there was a valid
arm’s-length sale of the commercial properties involved. The
situation is instead analogous to one we addressed in Estate of
Labombarde v. Commissioner, 58 T.C. 745, 754-755 (1972), affd.
per order (1st Cir. Aug. 21, 1973), where a widow transferred her
interest in some real estate to her children. There we said:
While unquestionably money or money’s worth was
received by decedent during her lifetime, we are
constrained to hold that the purpose of the payment was
not to create a debt but rather in furtherance of the
children’s admirable desire to see their widowed mother
live out her days in a style to which she was
accustomed. As is understandable in the exemplary
family situation, there simply was no intent to create
a bona fide debt.
Under these circumstances, we believe that the provisions
of section 2512(b) are dispositive. As respondent has asserted
in his Amended Answer, decedent’s transfer to Michael was a gift
to the extent that it exceeded the consideration actually paid.
See Commissioner v. Wemyss, 324 U.S. 303, 306 (1945);
Hollingsworth v. Commissioner, 86 T.C. 91, 96 (1986); Harwood v.
Commissioner, 82 T.C. 239, 257 (1984), affd. without published
opinion 786 F.2d 1174 (9th Cir. 1986).
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