- 19 -
Petitioners also argue that the cases involving indirect
transfers through trusts and corporations are inapplicable to the
direct transfers at issue here. Petitioners allege:
When an equity interest in a business (or any
property) is transferred outright, the donee receives
all rights in and to the equity interest (or other
property) upon transfer, whatever those rights may be.
The lack of any “postponement” of the donee’s rights to
enjoyment of the equity interest (or other property) is
manifestly clear. * * *
From the foregoing premise, petitioners maintain that the
standards referenced to analyze whether rights are postponed when
interests in the subject property are held only indirectly
through the conduit of a trust or corporate entity have no place
in the present situation.
Conversely, respondent argues that petitioners’ transfers of
Treeco units fail to qualify as gifts of present interests.
Respondent avers that because of the restrictions contained in
the Treeco Operating Agreement, the transfers fell short of
conferring on the donees the requisite immediate and
unconditional rights to the use, possession, or enjoyment of
property or the income from property. Unlike petitioners,
respondent finds the body of law regarding indirect transfers to
constitute “substantial analogous authority” and the principles
espoused therein to control the outcome of these cases.
Specifically, respondent emphasizes the requirement of present
economic benefit and contends that the inability of the donees to
Page: Previous 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 NextLast modified: May 25, 2011