Estate of Edna Korby - Page 14

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          395 U.S. 316 (1969).  Section 2036(a)5 generally provides that if           
          a decedent makes an inter vivos transfer of property, other than            
          a bona fide sale for adequate and full consideration in money or            
          money’s worth, and retains certain enumerated rights or interests           
          in the property which are not relinquished until death, the full            
          value of the transferred property will be included in the                   
          decedent’s gross estate.  Section 2036(a) is applicable when                
          three conditions are met:  (1) The decedent made an inter vivos             
          transfer of property; (2) the decedent retained an interest or              
          right enumerated in section 2036(a)(1) or (2) or (b)6 in the                
          transferred property which he did not relinquish before his                 

               5SEC. 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.                                 
               6Sec. 2036(b) provides that the retention of the right to              
          vote shares of a controlled corporation that were transferred by            
          a decedent is the retention of the enjoyment of the transferred             
          property.                                                                   





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