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Immediate FLP Gifting: Legitimate Estate Planning or Transfer Tax Avoidance?
Estate & Gift · Complexity Very High 2026-03-29 ef9f4356
Taxpayer formed FLP to hold eight commercial properties ($40M FMV, $15M debt, $3M annual NOI), contributed all assets individually, retained 2% GP interest with full management control, and gifted 98% LP interests to three children within same month as formation and funding, claiming 30% combined valuation discount.
Taxpayer may proceed with FLP formation and immediate gifting provided partnership is operated with complete legal formalities (separate accounts, entity-level lease execution, documented distribution…
family limited partnershipFLPvaluation discountlack of marketabilitylack of controlSection 2036
📚 5 authorities 4.5 ✓
Real Estate FLP with Retained Management: Legitimate Business or §2036 Trap?
Estate & Gift · Complexity High 2026-03-28 f548b61c
68-year-old donor contributed six apartment buildings ($30M value, $2M debt) to FLP, retained 1% GP and 30% LP interests, and gifted 69% LP interests to three adult children within three months. Partnership pays donor $200k annual guaranteed payment for management services and distributes remaining $1M NOI proportionally quarterly to all partners including children.
FLP structure is respected for estate and gift tax purposes with 30-35% valuation discount on gifted LP interests. Donor's retained GP management authority does not trigger IRC § 2036 inclusion becaus…
2036FLPvaluation discountguaranteed paymentgeneral partner retained controlstep transaction
📚 9 authorities 4.2 ✓