EFTA02556784

From: Jeffrey Epstein <[email protected]> Sent: Friday, July 6, 2012 3:18 AM To: Eileen Alexanderson; Melanie Spinella The IRS has advanced many theories to challenge the gift and estate tax savings occasioned by the use of family entities and grantor trusts in estate planning. Until recently, most IRS arguments had been rather unsuccessful. However, the IRS discovered a potent weapon in IRC § 2036(a), which provides that the value of the gross estate includes the value of all property to the extent the decedent has made a transfer but has retained (i) the possession or enjoyment of, or the right to income from, the property, or (ii) the right, either alone or in conjunction with any person, to designate the persons who shall possess or enjoy the property or the income therefrom. The IRS has been successful in arguing that IRC § 2036(a) requires the inclusion in the decedent's estate of=20 (i) partnership assets if the decedent continued to derive benefits from the partnership, or of (ii) trust assets, if the decedent continued to receive distributions, disguised in the form of a note, from assets sold to a "defective" grantor trust. The IRS has been most successful where=20 the transactions with not imbued with a sufficient quantum of non-tax objectives, or the economics of the transaction were questionable, most often because the grantor had not left himself with sufficient assets to live according to his accustomed standard without receiving partnership (or trust) distributions. The information contained in=this communication is confidential, may be attorney-client privileged, =ay constitute inside information, and is intended only for the use of the a=dressee. It is the property of Jeffrey Epstein Unauthorized use, di=closure or copying of this communication or any part thereof is strictl= prohibited and may be unlawful. If you have received this communication in error, p=ease notify us immediately by return e-mail or by e-mail to [email protected], =nd destroy this communication and all copies thereof, including all attachm=nts. copyright -all rights reserved 1 EFTA_R1_01715536 EFTA02556784