Estate of Bischoff v. Commissioner
United States Tax Court
Within a very short time period, Bruno and Bertha Bischoff each created identical trusts for their joint grandchildren, naming each other as trustee. On Bruno's and Bertha's deaths, held, the corpora of such trusts are includable in their estates. Held, further: On the facts, the estate tax valuation of decedents' interests in certain partnerships is limited by the restrictive buy-sell provisions to which the interests were subject at death.
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Within a very short time period, Bruno and Bertha Bischoff each created identical trusts for their joint grandchildren, naming each other as trustee. On Bruno's and Bertha's deaths, held, the corpora of such trusts are includable in their estates. Held, further: On the facts, the estate tax valuation of decedents' interests in certain partnerships is limited by the restrictive buy-sell provisions to which the interests were subject at death. The value of another limited partnership interest is determined, applying a discount from asset value for minority ownership.
1Dissent
Hall,
dissenting in part: In every one of the cases in which the reciprocal trust doctrine has ultimately been applied, including United States v. Estate of Grace, 395 U.S. 316 (1969), the arrangements that were challenged involved the crossing between grantors of very substantial economic interests. All but one of the cases involved the exchange of life estates or beneficial powers exercisable by the holders for their own benefit.1 The one exception, a decision of this Court, subsequently reversed by the Court of Appeals for the Third Circuit, involved the exchange of significant powers to…
2Cases cited13 opinions
- Orvis v. HigginsCourt of Appeals for the Second Circuit · 1950
- Lehman v. Commissioner of Internal RevenueCourt of Appeals for the Second Circuit · 1940
- United States v. Estate of GraceSupreme Court of the United States · 1969
- Cole's Estate v. Com'r of Internal RevenueCourt of Appeals for the Eighth Circuit · 1944
- Hanauer's Estate v. Commissioner of Internal Rev.Court of Appeals for the Second Circuit · 1945
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