-45-
of Korby v. Commissioner, T.C. Memo. 2005-103; Estate of Korby v.
Commissioner, T.C. Memo. 2005-102. Such is especially so where,
as here, decedent’s daughter (as decedent’s attorney-in-fact)
transferred substantially all of decedent’s assets to the LRFLP
and did not retain sufficient assets to support decedent for the
rest of her life. See Estate of Thompson v. Commissioner, supra
at 376-377.
Nor does the credible evidence in the record support the
purposes that petitioners allege motivated the formation of the
LRFLP. First, as to petitioners’ claim that the LRFLP was formed
to create centralized management, decedent had centralized
management through the Lillie Investment Trust. The Lillie
Investment Trust held almost all of decedent’s assets and allowed
her (or a successor trustee) to manage and control her assets in
full.21 In fact, even Feldman admitted that decedent had
centralized management through the Lillie Investment Trust.
While Feldman also stated that the LRFLP allowed decedent to make
gifts of a limited partnership interest without selling any
assets, we do not find that decedent, before the transfer, had to
sell any of her assets to make the gifts that she then made;
e.g., she annually selected the stocks and bonds that were the
21 For example, decedent’s daughter, as a successor
co-trustee, displayed her control over decedent’s assets when she
transferred the assets from the Merrill Lynch trust account to
the Merrill Lynch LRFLP account.
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