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The estate also argues that the value of the annuity
purchased in 1998 by Austin using the proceeds of KPLP’s U.S.
savings bonds should not be included in Edna’s gross estate. The
estate does not argue that the annuity should not be treated as a
gift or contest the value respondent ascribed to the annuity
($43,638). The estate’s argument is moot; respondent does not
argue that it should be included in the gross estate. The estate
does not dispute respondent’s adjustment of the estate’s adjusted
taxable gifts by the value of the 1998 annuity.
III. Marital Deduction Under Section 2056
Section 2056 provides for a deduction from the gross estate
of a decedent for the value of property that passes from the
decedent to the surviving spouse. The estate conceded that if
respondent agrees that the value of only 38.26 percent of KPLP’s
assets is includable in Edna’s gross estate and 58.46 percent is
includable in Austin’s gross estate, the marital deduction does
not apply to the KPLP assets. The parties have so agreed, and we
accept the estate’s concession that the marital deduction does
not apply to the 38.26-percent portion of KPLP’s value includable
in Edna’s gross estate under section 2036(a)(1).9 Respondent
9The estate argues nonetheless that respondent conceded the
marital deduction should apply to the KPLP assets in Edna’s
estate. In an e-mail dated approximately 3 months before trial,
respondent’s counsel stated: “we will stipulate to the marital
deduction issue”. The estate essentially claims that respondent
should be bound by his statement by equitable estoppel. We
(continued...)
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