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v. United States, supra, nor Murray v. United States, supra, is
binding on us, and, indeed, the facts of both cases are somewhat
different from the facts before us today. Armstrong Trust did
not involve a specific assumption of the potential 2035 tax as a
condition of the underlying gift (as is the case here); rather,
the donees were statutorily liable for any 2035 tax under section
6324(a)(2). In Murray, unlike the instant case, the obligation
was not limited to the “gross-up” tax of (original) section
2035(c), with its preordained inclusion amount and accompanying
3-year window of inclusion (indeed, that provision and the
unified gift and estate tax system had yet to be enacted).
Nevertheless, we agree with what we believe to be the basis of
those two opinions, i.e., that, in advance of the death of a
person, no recognized method exists for approximating the burden
of the estate tax with a sufficient degree of certitude to be
effective for Federal gift tax purposes. See also Estate of
Armstrong v. Commissioner, 119 T.C. 220, 230 (2002).
Petitioners’ computation of the mortality-adjusted present
value of the children’s obligation to pay the 2035 tax does
50(...continued)
119 T.C. 220, 230 (2002) (addressing certain Federal estate tax
questions with respect to the same gifts in question in Armstrong
Trust v. United States, 132 F. Supp. 2d 421 (W.D. Va. 2001),
affd. sub nom. Estate of Armstrong v. United States, 277 F.3d 490
(4th Cir. 2001)), we said: “The donee children’s mere
conditional promise to pay certain additional gift taxes that
decedent might be determined to owe does not reduce the amount of
decedent’s gift taxes included in the gross estate under section
2035(c).”
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