Holman v. Commissioner (II)
Eighth Circuit upholds Tax Court’s decision regarding application of IRC Sec. 2703 to FLP transfer restrictions and their limitation of marketability discounts under the fair market value standard.
A ‘Facts Too Good to Be True’ Family Limited Partnership Case?
Tax Court finds excellent facts regarding formation and legitimate, nontax purpose of a family limited partnership, sufficient to value its interests at a stipulated discount for purposes of estate tax.
Billion-Dollar Transfer Pricing Case Turns on Testimony of ‘Incredible’ IRS Experts
IRS loses billion-dollar transfer pricing case based on expert’s wrong determinations of cost of capital and more.
Estate of Shurtz v. Commissioner
Tax Court finds legitimate, non-tax business purpose in FLP’s active management and preservation of timber, and its protection against creditors.
Estate of Christiansen v. Comm’r
In estate tax case, federal court upholds disclaimer provisions similar to defined value clauses.
‘Sham’ Funding Plus Pledging FLP Assets for Personal Debt Adds Up to Taxpayer Loss
Tax Court finds transfer of $16 million in marketable securities to two FLPs fail to qualify as bona fide, nontax business transactions when decedent retained full use of assets, including pledging them as collateral for personal debt.
Another Taxpayer Win: Court Accepts 47.5% Discount for Formed (But Not Funded) FLP
Court accepts combined discounts of 47.5% on transfers to an FLP, which was formed but not fully funded before the founder’s death.
Estate of Black v. Commissioner
Tax Court finds excellent facts regarding formation and legitimate, non-tax purpose of a family limited partnership, sufficient to value its interests at a stipulated discount for purposes of estate tax.
Veritas Software Corp. v. Commissioner
IRS loses billion-dollar transfer pricing case based on expert’s wrong determinations of cost of capital and more.
Estate of Petter v. Commissioner (I)
Tax Court upholds defined value, formula allocation clause in gift tax case.
Tax Court Split 9 to 6 on Preserving Family LLC for Gift vs. Income Tax Purposes
In a 9-to-6 split decision, U.S. Tax Court decides that “check-the-box” regulations, which disregard the entity form of a single-member LLC for federal income tax purposes, do not apply to assessments of federal gift taxes.
IRS Challenges Family LLC as Indirect Gift, Including 58% Marketability Discount
Court finds $2.5 million cash transfers to family limited company are indirect gifts, subject to gift tax for full value, excluding 58% marketability discounts.
Estate of Malkin v. Commissioner
Tax Court finds transfer of $16 million in marketable securities to two FLPs fail to qualify as bona fide, non-tax business transactions when decedent retained full use of assets, including pledging them as collateral for personal debt.
New FLP Case: Taxpayer’s First Asset Transfer Merits Discount, But Not Second
Court finds initial transfer of funds to FLP qualifies for exclusion from the estate at discounted value, but second transfer does not, for lack of bona fide business purpose.
Pierre v. Commissioner (I)
In a 9-to-6 split decision, U.S. Tax Court decides that “check-the-box” regulations, which disregard the entity form of a single-member LLC for federal income tax purposes, do not apply to assessments of federal gift taxes.
Keller v. United States (II)
Court accepts combined discounts of 47.5% on transfers to an FLP, which was formed but not fully funded before the founder’s death.
9th Circuit Follows Up on Value of Fractional Interest in Major Art Collection
9th Circuit rejects estate’s appeal of 5% discount for a 50% undivided fractional interest in art collection, based on insufficient appraisal evidence to carry the taxpayer’s burden of proof to show that IRS assessment was wrong.
Heckerman v. Commissioner
Court finds $2.5 million cash transfers to family limited company are indirect gifts, subject to gift tax for full value, excluding 58% marketability discounts.
Tax Court’s Adjustment to Reasonable Compensation ‘Dizzying and Arbitrary’
7th Circuit reverses Tax Court’s determination of reasonable compensation for CEO of third largest retail hardware chain, questioning its reliance on investor rate of return as the sole driver of a decision.
Terrible FLP Facts Preclude Analysis of Discounts
Tax Court finds not one factor supporting a legitimate, nontax business purpose for family limited partnerships funded with over $2 million in largely untraded marketable securities.
Estate of Miller v. Commissioner
Court finds initial transfer of funds to FLP qualifies for exclusion from the estate at discounted value, but second transfer does not, for lack of bona fide business purpose.
New Tax Court Decision on Discounts and Embedded Taxes Hinges on Experts
Tax Court considers determination of discounts for embedded capital gains taxes, lack of control, and lack of marketability for estate’s interests in two closely held companies, one owning primarily farm land and the other marketable securities.