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whether the value of that property should be included in
decedent’s estate pursuant to section 2036,1 and whether
decedent’s estate is entitled to deductions relating to property
taxes and claims against the estate.
FINDINGS OF FACT
On July 10, 1989, Margot Stewart (decedent) executed a deed
that transferred to Brandon Stewart, her son, real property
located in East Hampton, New York (the East Hampton property).
As a result of the transfer, decedent and Mr. Stewart owned the
East Hampton property as joint tenants with rights of
survivorship. Decedent and Mr. Stewart agreed to share the
income and expenses relating to the East Hampton property.
Decedent also owned real property located at 160 East 61st
Street, New York, New York (the 61st Street property). Decedent
and Mr. Stewart resided on the first two floors of the 61st
Street property. Beginning on October 1, 1999, decedent leased
the remaining three floors of the 61st Street property to
Financial Solutions, Ltd., an unrelated third party, for $9,000
per month.
On May 9, 2000, decedent executed a deed that transferred to
Mr. Stewart a 49-percent interest in the 61st Street property.
1 Unless otherwise indicated, all section references are to
the Internal Revenue Code in effect for the year in issue, and
all Rule references are to the Tax Court Rules of Practice and
Procedure.
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