Significant Tax Cases

• Steinberg – Tax Court rejected IRS challenge to gift tax value offset for donees’ assumption of potential estate tax under I.R.C. § 2035 ("net, net gift") (Steinberg v. Comm’r, 141 T.C. 258 (2013))
• Estate of Anne Y. Petter – Tax Court and Ninth Circuit rejected IRS challenge to a dollar value formula clause in case of first impression involving gift/sale of LLC units to family and charity based on values as “finally determined for federal gift tax purposes” (Estate of Petter v. Comm’r, 98 T.C.M. (CCH) 534 (2009), aff’d, 653 F.3d 1012 (9th Cir. Aug. 4, 2011))
• Hendrix – Tax Court rejected IRS challenge to dollar value formula clause used to gift corporate stock (Hendrix v. Comm’r, T.C. Memo 2011-133 (June 15, 2011))
• Estate of Charles H. Murphy, Jr. – obtained $42 million estate tax refund after district court trial in case involving numerous valuation issues and IRS attempt to ignore limited partnership under I.R.C. § 2036 (Estate of Murphy v. United States, No. 07-CV-1013, 2009 WL 3366099 (W.D. Ark. Oct. 2, 2009))
• Estate of Black – Tax Court rejected IRS attempt to apply § 2036 to ignore family limited partnership for estate tax purposes. (Estate of Samuel P. Black Jr., et al. v. Comm’r, 133 T.C. No. 15 (Dec. 14, 2009))
• Estate of Helen Christiansen – Tax Court and Eighth Circuit rejected IRS challenge to partial disclaimer of limited partnership interest to charity made by way of a dollar value formula based on values “as finally determined for estate tax purposes.” (Estate of Christiansen v. Comm’r, 130 T.C. No. 1 (2008), aff’d, 586 F.3d 1061 (8th Cir. 2009))
• Estate of Frazier Jelke, III – Successful Eleventh Circuit appeal and reversal of a Tax Court decision regarding the application of a dollar-for-dollar unrealized capital gains tax when determining the value of stock in a C corporation (Estate of Jelke III v. Comm’r, 507 F.3d 1317 (11th Cir. 2007))
• Litman/Diener – Favorable outcome for clients after Claims Court trial in case addressing lack of marketability discount to be applied in valuing restricted stock (Litman, et al. v. United States, 78 Fed. Cl. 90 (2007))
• Succession of Charles T. McCord, Jr. – Fifth Circuit rejected IRS challenge to a dollar value formula clause in case of first impression involving gift of limited partnership interests to family and charity (Succession of McCord v. Comm’r, 461 F.3d 614 (5th Cir. 2006))
• Estate of Charles Porter Schutt – Tax Court rejected IRS attempt to apply I.R.C. §§ 2036 and 2038 and ignore the existence of two Delaware Business Trusts for estate tax purposes (Estate of Schutt v. Comm’r, 89 T.C.M. (CCH) 1353 (2005))
• Estate of Wayne C. Bongard – Tax Court rejected IRS attempt to apply I.R.C. § 2036 to ignore the existence of a limited liability company for estate tax purposes (Estate of Bongard v. Comm’r, 124 T.C. 95 (2005))
• Estates of Eugene and Allene R. Stone – Tax Court rejected IRS attempt to apply I.R.C. § 2036 to ignore the existence of five family limited partnerships (Stone v. Comm’r, 86 T.C.M (CCH) 551 (2003))
• Estate of Joseph R. Coulter – Favorable outcome in defense of the estate against an IRS assertion of a $113 million estate tax deficiency in a Tax Court case involving the first-time application of I.R.C. § 2036(b) (T.C. Docket No. 17458-99)
• Estate of Nellie Segerstrom – District court rejected IRS summons of attorney-client privileged documents, and favorable outcome in defense of the estate in Tax Court in an $18 million dispute with the IRS regarding the estate tax value of real estate partnerships (Segerstrom v. United States, 87 A.F.T.R.2d 2001-1153 (N.D. Cal. 2001))
• Roy Rogers and Dale Evans Rogers – Favorable outcome in defense of taxpayers in a Tax Court case involving an IRS challenge to the gift tax value of family limited partnership interests (T.C. Docket No. 011557-98)
• Estate of A.D. Davis – Favorable outcome for the estate against the IRS in a case where the Tax Court first recognized the “unrealized capital gains discount” when valuing stock in a C-corporation (Davis v. Comm’r, 110 T.C. 530 (1998))
• Estate of Beatrice Dunn – Favorable Fifth Circuit appeal that reversed Tax Court decision regarding the valuation of a closely held corporation (Dunn v. Comm’r, 301 F.3d 339 (5th Cir. 2002))
• Estate of Jimmie T. Drewry – Favorable outcome against an IRS assertion of a $30 million estate tax deficiency in a Tax Court case involving recognition of private annuities and value of interests in a family limited partnership owning broadcast properties (T.C. Docket No. 10328-00)
• Baine P. and Mildred Kerr – Tax Court and Fifth Circuit appeal rejected IRS attempt to apply I.R.C. § 2704(b) in valuing an interest in a family limited partnership for gift tax purposes in case of first impression (Kerr v. Comm’r, 292 F.3d 490 (5th Cir. 2002))
• Estate of Jameson – Favorable outcome in a Tax Court trial and Fifth Circuit appeal of a case involving an unrealized capital gains discount when valuing stock in a closely held C-corporation (Jameson v. Comm’r, 267 F.3d 366 (5th Cir. 2001))

Significant Fiduciary Cases

• Estate of Jake Kamin – Summary judgment obtained on behalf of The Jake and Nina Kamin Foundation regarding construction of the provisions of Mr. Kamin’s will (In the Estate of Jake Kamin, Deceased, Probate Court No. 2 of Harris County Texas, Cause No. 399,104-401)
• Loya v. Loya, et al. – Favorable outcome for trustee in defense of breach of fiduciary duty claims regarding creation of trust and management of assets (In the Matter of the Marriage of Leticia B. Loya and Miguel Angel Loya, et al., Cause No. 2008-24514, Harris County, Texas, 257th Judicial District)
• Estate of Theodore Bauer – Favorable outcome for executor regarding claims that decedent made improper gifts of community property funds and breached fiduciary duties in managing community estate (Ruth Brouse Bauer, et al. vs. JPMorgan Chase Bank, N.A., Independent Executor, et al, Cause No. 348,876-401; in Probate Court No. 4 of Harris County, Texas)
• Kenedy Memorial Foundation v. Fernandez – Court rejected claim of purported heir to set aside probate of decedent’s will and division of estate property (John G. and Marie Stella Kenedy Memorial Foundation v. Fernandez, 315 S.W.3d 515 (Tex. 2010))
• Wood v. Victoria Bank & Trust – Court rejected attempts by trust beneficiaries to pursue class action breach of fiduciary duty claims related to trustee’s acquisition by merger of fiduciary accounts from Ameritrust, N.A. (Wood v. Victoria Bank & Trust Co., et al., 69 S.W.3d 235 (Tex. App. -- Corpus Christi 2001))
• Farias v. Laredo National Bank – Court ruled that breach of fiduciary duty claims asserted by remainder beneficiaries of trust against trustee barred by the statute of limitations (Farias v. Laredo National Bank, 985 S.W. 2nd 796 (Tex. App. -- San Antonio 1997))
• Finley v. Laredo National Bank – Favorable outcome for trustee regarding claims of five beneficiaries concerning the management of trusts and a partnership that owned an 85,000 acre ranch and mineral interests (Finley, et al. v. The Laredo National Bank, District Court, Webb County, Texas)