Cook v. Commissioner of the Internal Revenue Service

DUHÉ, Circuit Judge:

Appellants ask this Court to reverse the Tax Court’s conclusion that a non-transfer-rable lottery prize payable in seventeen annual installments is a private annuity that must be valued, for estate tax purposes, in accordance with 26 U.S.C. § 7520. Because we conclude that the prize is properly characterized a private annuity, and that non-marketability does not render the valuation of the prize under § 7520 and the regulations unreasonable, we affirm.

FACTUAL AND PROCEDURAL HISTORY

Gladys Cook and her sister-in-law Myrtle Newby had a longstanding informal agreement under…