Estate of Alfred J. Richard v. Commissioner, T.C. Memo 2012-173 (6/20/2012), is an unusual case in which the government sought to include 140 shares of preferred stock in A.J. Richard & Sons, Inc. (the “Company”) in the gross estate of the decedent, Alfred Richard (“Alfred”). The shares were initially reported on the estate tax return, but it was later determined that Alfred did not own the shares that passed through his predeceased wife’s will. The government’s arguments in opposition to the estate’s amended Tax Court petition reducing the number of shares of preferred stock from the 740 shares reported on the estate tax return by the 140 shares in Mrs. Richard’s name at the time of Alfred’s death, were each resoundingly overruled by Judge Goeke.
Mrs. Richard had died in 1997 at a time when she owned 140 shares of preferred stock in the Company and Alfred owned 600 shares