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provider. Again, the annuity contracts function only as the
chosen method of funding the legal rights created under the
settlement agreement, and such choice should not affect the value
of the independently operative legal entitlement.
A second, more practical problem arises in that the estate
has at no time offered any evidence whatsoever regarding the
value of comparable commercial contracts. The only figure
contained in the record other than that determined by respondent
in the notice of deficiency is the $1,118,000 listed on the
probate inventory. The estate has never mentioned how the
inventory amount was derived or suggested that it would equate
with the cost of a commercial contract. Accordingly, even if the
Court were to accept the estate’s position that the annuities
should be valued under section 20.2031-8, Estate Tax Regs., the
estate has failed to show that such value would in fact differ
from the amount determined by respondent under section 20.2031-7,
Estate Tax Regs. The Court is thus constrained to uphold
respondent’s $1,514,572 valuation.
IV. Deduction for Funeral Luncheon
Section 2053(a)(1) provides for a deduction from the gross
estate for such funeral expenses as are allowed by the laws of
the jurisdiction under which the estate is being administered.
Michigan law allows reasonable funeral and burial expenses as a
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