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HALPERN, J., concurring in part and dissenting in part.1
I. Introduction
I write separately to express my disagreement with the
majority’s interpretation of the bona fide sale exception found
in section 2036(a).2
The majority states:
In the context of family limited partnerships, the
bona fide sale for adequate and full consideration
exception is met where the record establishes [1] 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 believe that the majority has strayed from the traditional
interpretation of the bona fide sale exception by incorporating
into the exception an inappropriate motive test (“a legitimate
and significant nontax reason”), and by concluding that a
partnership interest “proportionate” to the value of the property
transferred constitutes adequate and full consideration in money
or money’s worth.
1 I concur with the majority insofar as it decides that the
value of the shares of Empak, Inc., transferred by decedent to
WCB Holdings, LLC (WCB Holdings), is not included in the value of
the gross estate (although I do not agree with the reasoning the
majority uses to reach that result). I disagree with the
majority that the value of the WCB Holdings membership units
transferred to the Bongard Family Limited Partnership is included
in that value.
2 I have not joined Judge Laro’s separate opinion because,
in important particulars, I disagree with his stated views.
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