- 14 -
satisfies section 7491(a)(2)(A) and (B) with respect to any
factual issue relating to respondent’s deficiency determinations
that remains in this case. On the record before us, we conclude
that the estate’s burden of proof on any such issue, see Rule
142(a); Welch v. Helvering, 290 U.S. 111, 115 (1933), does not
shift to respondent under section 7491(a).
We turn first to the power of appointment that decedent had
with respect to one-sixth of the principal of the testamentary
trust. For the first time on brief, the estate advances the
position that, pursuant to the testamentary trust, decedent had a
special power of appointment, and not a general power of appoint-
ment, with respect to that portion of the principal of that
trust.8 The estate does not cite any Code section, Treasury
regulation, or caselaw in support of its position.9 Instead, the
8We conclude that the estate’s position on brief that dece-
dent had a special power of appointment, and not a general power
of appointment, with respect to one-sixth of the principal of the
testamentary trust raises a new issue. However, respondent does
not object to, and we find no prejudice to respondent as a result
of, the estate’s raising that issue for the first time on brief.
9The estate acknowledges that if the Court were to find that
decedent had a general power of appointment with respect to one-
sixth of the principal of the testamentary trust, under Pennsyl-
vania law decedent exercised that power through the residuary
clause in her will. In that event, the estate would concede that
the portion of that principal subject to that power is includible
in decedent’s gross estate under sec. 2041(a)(1). The estate’s
position with respect to Pennsylvania law, see sec. 20.2041-1(d),
Estate Tax Regs., accurately reflects that under Pennsylvania law
an individual who has a general power of appointment may exercise
that power through the residuary clause in that individual’s
will. See 20 Pa. Cons. Stat. Ann. sec. 2514 (13) (West Supp.
(continued...)
Page: Previous 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 NextLast modified: May 25, 2011