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legally enforceable. Estate of Maxwell v. Commissioner, 3 F.3d
591, 593 (2d Cir. 1993), affg. 98 T.C. 594 (1992); Guynn v.
United States, supra at 1150; Estate of Reichardt v.
Commissioner, supra at 151; Estate of Rapelje v. Commissioner, 73
T.C. 82, 86 (1979). Regulations likewise provide that “An
interest or right is treated as having been retained or reserved
if at the time of the transfer there was an understanding,
express or implied, that the interest or right would later be
conferred.” Sec. 20.2036-1(a), Estate Tax Regs.
The existence or nonexistence of such an understanding is
determined from all of the facts and circumstances surrounding
both the transfer itself and the subsequent use of the property.
Estate of Reichardt v. Commissioner, supra at 151; Estate of
Rapelje v. Commissioner, supra at 86. However, an exception to
the treatment mandated by section 2036(a) exists where the facts
establish “a bona fide sale for an adequate and full
consideration in money or money’s worth”.
B. Burden of Proof
Typically, the burden of disproving the existence of an
agreement regarding retained enjoyment has rested on the estate,
and this burden has often been characterized as particularly
onerous in intrafamily situations. Estate of Maxwell v.
Commissioner, supra at 594; Estate of Reichardt v. Commissioner,
supra at 151-152; Estate of Rapelje v. Commissioner, supra at 86.
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