Estate of Howard Gilman, Deceased, Bernard D. Bergreen and Natalie Moody, Executors - Page 24

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          administration expenses.  The estate contends that a reasonable             
          estimate satisfies the requirement of section 2053 that expenses            
          be necessary for the administration of the estate because (a)               
          only an estimate of the amount of the loan was possible when the            
          estate obtained the loan, and (b) the estate’s obligation to pay            
          the $38 million loan and interest thereon is fixed.  Thus, the              
          estate contends, it may deduct the interest on that portion of              
          the loan to be used to pay miscellaneous expenses of $816,175.              
          We disagree because the record does not show what expenses are              
          included in the $816,175 amount.  Thus, these expenses may no               
          more be estate expenses than was the compensation for Bergreen              
          and Davis.  See paragraph A-2, above.                                       
               4.   Whether the Estate Was Illiquid When It Borrowed Funds            
                    From Farm Credit                                                  
               Respondent contends that, after the estate paid the cash               
          bequests in May 1998, it had enough liquid assets with which to             
          pay its estate taxes and administration expenses and thus did not           
          need the Farm Credit loan.  We disagree.                                    
               After payment of the cash bequests and before the                      
          restructuring, the estate had more than enough assets to pay                
          administration expenses and Federal and State estate taxes.                 
          However, these assets were illiquid.  Every witness, including              
          respondent’s witnesses Rossellini, Justin Feldman, and John J.              
          Kennedy (all of whom were independent directors on the board of             







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