Estate of Joanne Harrison Stone, et. al. v. Commissioner (U.S. Tax Court)

Descendent and husband had decided to form a family limited partnership to hold the woodland parcels they had acquired on December 29, 1997 so that they could transfer it to their family. On December 31, 1997, decedent and husband gave portions of their limited interests in the Stone FLP to 21 family members. Throughout the years, the same was done and by the end of 2000, descendent and husband each owned a 1% general partnership interest and the remaining 98% interest was held by the children, children’s spouses, and grandchildren. The deficiency in federal estate tax for the Estate of Joanne Stone should not include the property transferred in the Stone FLP as it was deemed a bona fide transfer due to the fact that the decedent and husband did not rely on SFLP distributions, they actually did transfer the parcels correctly, and there was no comingling of personal and partnership funds.