Like bringing a knife to a gunfight: Why IRC Section 2036 is not the right weapon to combat abusive family limited partnerships |
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Authors: | Nicholas J. Trotta |
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Affiliation: | Maurice A. Deane School of Law at Hofstra University, Hempstead, New York, USA |
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Abstract: | Family Limited Partnerships (“FLPs”), which were once a great estate planning technique, have now become victim to Section 2036 assertions made by the IRS. Over the years, the IRS has struggled to find a means to combat abusive FLPs until the courts began to embrace Section 2036 as a weapon for them to use. Different courts, however, have maintained different rules and have now subjected both abusive and non-abusive FLPs to inclusion of their assets into their gross estates. This has shed light onto the main issue, that is, that Section 2036 is not the appropriate tool to combat abusive FLPs. |
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Keywords: | discounted estate estate planning estate transfer family limited partnership FLP FLP benefits limited partnership section 2036 section 2036(a) valuation discount |
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