FLP owners score yet another Tax Court victory

Description

Abstract: In addition to achieving other legitimate business purposes, holding discounted units in a family limited partnership (FLP) can result in a lower estate value than holding the underlying, undiscounted assets in an estate. Yet the IRS has successfully used IRC Section 2036 to persuade the U.S. Tax Court to eliminate discounts for lack of control and marketability in several FLP cases. This article reviews an exception to that trend — a case in which the agency wasn’t successful.