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3. Each Step of the Transaction Is Part of an Integrated
Transaction
All of the steps which were taken to effect the transfer of
petitioners’ partnership interests to their sons (inclusive of
the trusts) were part of a single integrated transaction. The
purpose of that transaction was to transfer the interests with an
avoidance of Federal gift taxes, while, at the same time,
discouraging audit of the transfer and manufacturing phantom
charitable gift and income tax deductions in the event that the
value of the transfer was later increased. I reach my conclusion
in light of the following facts which were found by the trial
judge or are reasonable inferences therefrom: (1) Petitioners
were seeking expert advice on the transfer of their wealth with
minimal tax consequences, (2) the transaction contemplated that
the charities would be out of the picture shortly after the gift
was made, (3) the transfers of the partnership interests to the
charities were subject to a call provision that could be
exercised at any time, (4) the call provisions were exercised
almost contemporaneously with the transfers to the charities,
(5) the call price was significantly below fair market value,
(6) the charities never obtained a separate and independent
appraisal of their interests (including whether the call price
was actually the fair market value of those interests),
(7) neither charity ever had any managerial control over the
partnership, (8) the charities agreed to waive their arbitration
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