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Property Interests Held by Decedent at Time of Death
At the time of her death, decedent owned a 27.5-percent
interest in Clubside, a partnership owned collectively by
decedent and her family.4 Mr. Hoffman owned a 27.5-percent
interest in Clubside, and the three children each held 15-percent
interests.
As of August 18, 1994, the asset-to-liability ratio of
Clubside was approximately 3 to 1. As of that date, it appears
Clubside had cash of approximately $3,176. Clubside’s only
significant asset was certain real property (Cathead property)
located on North Cathead Point Road in Northport, Michigan. The
Cathead property consisted of approximately 102 acres of
waterfront property on Lake Michigan.5 As of December 30, 1992,
the highest and best use of the Cathead property was the
development of the land into 20 waterfront improved sites which
4The parties stipulated that decedent was a partner of
Clubside at the time of her death. In its brief, the estate
argues for the first time that the partnership interest was owned
by decedent’s revocable trust. Our analysis and valuation of the
property interests in issue are the same regardless of whether
decedent or decedent’s revocable trust was the owner of the
partnership interest. Because the partnership interest is
includable in decedent’s gross estate in either situation and our
valuation analysis is not affected by such a determination, we
shall refer to the partnership interest as being owned by
decedent.
5The Cathead property included a two-story house located on
an 8.5-acre site with 300 feet of lake frontage which was owned
at the time of the appraisal by decedent and Mr. Hoffman, not
Clubside.
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Last modified: May 25, 2011