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LARO, J., concurring in result: I concur only because I am
uncomfortable with the analysis used by the majority in arriving
at its result. That analysis applies a new test that the
majority has created to decide whether a transfer to a family
limited partnership should be respected for Federal tax purposes.
The majority applies its test in lieu of deeply ingrained caselaw
that conditions satisfaction of the “bona fide sale for an
adequate and full consideration in money or money’s worth”
exception of section 2036(a) (adequate and full consideration
exception) on the transferor’s receipt of property equal in value
to that of the property transferred by the transferor. In other
words, under that caselaw, the adequate and full consideration
exception may apply only where the transferor’s receipt of
consideration is of a sufficient value to prevent the transfer
from depleting the transferor’s gross estate.
The majority states its test as follows: “In the context of
family limited partnerships, the bona fide sale for adequate and
full consideration exception is met where [1] the record
establishes the existence of a legitimate and significant nontax
reason for creating the family limited partnership, and [2] the
transferors received partnership interests proportionate to the
value of the property transferred.” Majority op. p. 39. I
disagree with both prongs of this test. I believe that a
transferor satisfies the adequate and full consideration
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