IRS victory highlights the importance of careful estate planning
Abstract: This article discusses a recent case in which the IRS attacked a family limited partnership (FLP) for being an invalid partnership under state law. The IRS lost that argument. Ultimately, however, it was the decedent’s estate planning that undermined the FLP, thus handing the IRS another win in its long-running campaign against FLPs. A sidebar notes that the estate did prevail on whether some cash transfers that the FLP made were loans or gifts for federal gift tax purposes.