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Tax Law Update 2010-07-01 (1)Tax Law Update 2010-07-01 (1)
Tax Court collapses gift and sale transaction but upholds discount In 2009, the Tax Court held that the single member limited liability company (LLC) Suzanne J. Pierre formed as a part of her estate plan shouldn't be disregarded for gift tax valuation purposes under the regulations (133 TC No. 2 (Aug. 24, 2009)). However, other issues that the court had bifurcated were left undecided. The Tax Court
David A. Handler, partner in the Chicago office of Kirkland & Ellis LLP, and Alison E. Lothes, as
Tax Court collapses gift and sale transaction but upholds discount — In 2009, the Tax Court held that the single member limited liability company (LLC) Suzanne J. Pierre formed as a part of her estate plan shouldn't be disregarded for gift tax valuation purposes under the “check-the-box” regulations (133 TC No. 2 (Aug. 24, 2009)). However, other issues that the court had bifurcated were left undecided. The Tax Court has now addressed the outstanding issues of whether the step transaction should apply to collapse a gift and sale of LLC interests and what discounts, if any, should apply when valuing the LLC interests. Pierre v. Commissioner, TC...
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