- 29 -
managed by the decedent exactly as in the past. Id. We
therefore found the assets includable under section 2036(a). Id.
We agree with respondent that the circumstances before us
bear many similarities to those in Estate of Reichardt v.
Commissioner, 114 T.C. 144 (2000), and Estate of Schauerhamer v.
Commissioner, supra, and are convinced that a like result should
obtain. We focus particularly on the commingling of funds, the
history of disproportionate distributions, and the testamentary
characteristics of the arrangement in support of our conclusion
that there existed an implied agreement that decedent would
retain the economic benefit of the assets transferred to HFLP.
As regards commingling of funds, we note that this fact was
one of the most heavily relied upon in both Estate of Reichardt
v. Commissioner, supra at 152, and Estate of Schauerhamer v.
Commissioner, supra. We find the disregard here for partnership
form to be equally egregious. The Agreement specified: “All
funds of the Partnership shall be deposited in a separate bank
account or accounts”. Yet no such account was even opened for
HFLP until September 23, 1994, more than 3 months after the
entity began its legal existence. Prior to that time,
partnership income was deposited in the Trust’s account,
resulting in an unavoidable commingling of funds.
Michael testified concerning this delay as follows:
Inadvertently, either my account or I failed to apply
timely for any--an employee [sic] identification
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