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preponderance of the evidence and is unaffected by section 7491.
See Blodgett v. Commissioner, 394 F.3d 1030, 1035 (8th Cir.
2005), affg. T.C. Memo. 2003-212; Estate of Stone v.
Commissioner, T.C. Memo. 2003-309.
II. Sections 2035(a) and 2036(a)
The purpose of section 2036 is to include in a deceased
taxpayer’s gross estate inter vivos transfers that were
testamentary in nature. United States v. Estate of Grace, 395
U.S. 316 (1969). Section 2036(a)9 generally provides that if a
decedent makes an inter vivos transfer of property, other than a
bona fide sale for adequate and full consideration, and retains
certain enumerated rights or interests in the property which are
9SEC. 2036. TRANSFERS WITH RETAINED LIFE ESTATE.
(a) General Rule.–-The value of the gross estate
shall include the value of all property to the extent
of any interest therein of which the decedent has at
any time made a transfer (except in case of a bona fide
sale for an adequate and full consideration in money or
money's worth), by trust or otherwise, under which he
has retained for his life or for any period not
ascertainable without reference to his death or for any
period which does not in fact end before his death–-
(1) the possession or enjoyment of, or
the right to the income from, the property,
or
(2) the right, either alone or in
conjunction with any person, to designate the
persons who shall possess or enjoy the
property or the income therefrom.
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