Estate of Duilio Costanza - Page 10

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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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