Holman v. Comm'r’s Empirical Analysis

Citation profile

3 federal appellate ·

Most-quoted passages

The sentences later courts lift from this opinion, ranked by how many decisions quote each — the parts of the opinion doing the work. These counts are smaller than the citation total above because most of the 22 citing decisions cite the case generally; a passage count includes only decisions quoting that exact language verbatim.

1. “We believe that paragraphs 9.1 through 9.3 were designed principally to discourage dissipation by the children of the wealth that Tom and Kim had transferred to them by way of the gifts. The meaning of the term “bona fide business arrangement” in section 2703(b)(1) is not self apparent. As discussed supra, in Estate of Amlie v. C.I.R., [ 91 T.C.M. (CCH) 1017 , 2006 WL 995337 ], we interpreted the term “bona fide business arrangement” to encompass value-fixing arrangements made by a conservator seeking to exercise prudent management of his ward’s minority stock investment in a bank consistent with his fiduciary obligations to the ward and to provide for the expected liquidity needs of her estate. Those are not the purposes of paragraphs 9.1 through 9.3. There was no closely held business here to protect, nor are the reasons set forth in the Committee on Finance report as justifying buy-sell agreements consistent with petitioners’ goals of educating their children as to wealth management and “disincentivizing” them from getting rid of Dell shares, spending the wealth represented by the Dell shares, or feeling entitled to the Dell shares. We find that paragraphs 9.1 through 9.3 do not serve bona fide business purposes. Those paragraphs do not constitute a bona fide business arrangement within the meaning of section 2703(b)(1).”

   1 later decision quote this exact passage · from the majority
   e.g. Holman v. Commissioner

2. “[G]iven the significant minority interest and marketability discounts from an LP unit’s proportional share of the partnership’s [net asset value] that each expert would apply in valuing the gifts, it would appear to be in the economic interest of both any limited partner not under the economic necessity to do so but wishing to make an impermissible assignment of LP units and the remaining partners to strike a deal at some price between the discounted value of the units and the dollar value of the units’ proportional share of the partnership’s [net asset val ue]. The wishing-to-assign partner would get more than she would get in the admittedly “thin” market for private transactions, and the dollar value of each remaining partner’s share of the partnership’s [net asset value] would increase.”

   1 later decision quote this exact passage · from the majority
   e.g. Holman v. Commissioner

3. “The committee believes that buy-sell agreements are common business planning arrangements and that buy-sell agreements generally are entered into for legitimate business reasons that are not related to transfer tax consequences. Buy-sell agreements are commonly used to control the transfer of ownership in a closely held business, to avoid expensive appraisals in determining purchase price, to prevent the transfer to an unrelated party, to provide a market for the equity interest, and to allow owners to plan for future liquidity needs in advance.”

   1 later decision quote this exact passage · from the majority
   e.g. Holman v. Commissioner