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Accordingly, no deduction is allowed. Sec. 2053(c)(1)(B); sec.
20.2053-6(b), Estate Tax Regs.
IV. Deduction of Debt Owed to Mr. Stewart Is Not Allowed
The estate contends that it is entitled, pursuant to section
2053(a)(3), to deduct a debt owed to Mr. Stewart relating to the
purported reconciliation agreement, between Mr. Stewart and
decedent, to share the income and expenses relating to both
properties. An estate may deduct the value of a claim based on a
decedent’s promise to pay only if the liability was “contracted
bona fide and for adequate and full consideration in money or
money’s worth”. Sec. 2053(c)(1)(A); See Estate of Scholl v.
Commissioner, 88 T.C. 1265, 1279 (1987). There was no
reconciliation agreement. Accordingly, no deduction is allowed.
Contentions we have not addressed are irrelevant, moot, or
meritless.
To reflect the foregoing,
Decisions will be entered
under Rule 155.
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Last modified: May 25, 2011