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substantial economic benefit of the type necessary to qualify for
the annual exclusion. While we are aware of petitioners’
contentions and the parties’ rather conclusory stipulations that
Treeco was a legitimate operating business entity and that
restrictive provisions in the Agreement are common in closely
held enterprises and in the timber industry, such circumstances
(whether or not true) do not alter the criteria for a present
interest or excuse the failure here to meet those criteria.
As we consider potential benefits inuring to the donees from
their receipt of the Treeco units themselves, we find that the
terms of the Treeco Operating Agreement foreclosed the ability of
the donees presently to access any substantial economic or
financial benefit that might be represented by the ownership
units. For instance, while an ability on the part of a donee
unilaterally to withdraw his or her capital account might weigh
in favor of finding a present interest, here no such right
existed. According to the Agreement, capital contributions could
not be demanded or received by a member without the manager’s
consent. Similarly, a member desiring to withdraw could only
offer his or her units for sale to the company; the manager was
then given exclusive authority to accept or reject the offer and
to negotiate terms. Hence some contingency stood between any
individual member and his or her receipt from the company of
economic value for units held, either in the form of approval
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