National Association of Estate Planners and Councils

September, 2023 Newsletter
Provided by Leimberg Information Services

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Paul Hood: Connelly Estate Files a Petition for Certiorari with the United States Supreme Court

On August 16, 2023, U.S. Supreme Court Docket No. 23-146, to appeal the unanimous decision of the United States Eighth Circuit. Robert L. Devereux, Esq. and Mary C. Devereux, of Aegis Law, St. Louis, continue to represent the Connelly Estate, but the Estate added Kannon K. Shanmugam, Esq. of Weiss, Rifkind, Wharton & Garrison LLP as Counsel of Record in the United States Supreme Court.

According to the Estate’s Petition, the question presented to the United States Supreme Court is:

Whether the proceeds of a life-insurance policy taken out by a closely held corporation on a shareholder in order to facilitate the redemption of the shareholder’s stock should be considered a corporate asset when calculating the value of the shareholder’s shares for purposes of the federal estate tax. [emphasis added]

The Estate’s Petition alleges a circuit conflict as the basis for justification for a grant of its writ of certiorari, thereby necessitating Supreme Court resolution:

The Eighth Circuit’s decision was erroneous, and it created a circuit conflict on an important question of federal tax law. Both the Ninth Circuit and the Eleventh Circuit have held that corporate insurance proceeds designated for redemption of a shareholder’s stock do not increase the value of the company for purposes of the estate tax. But in the decision below, the Eighth Circuit reached the opposite conclusion. Because this case is an ideal vehicle for resolving the resulting conflict on a discrete question of federal tax law, the petition for a writ of certiorari should be granted. [emphasis added]

The Estate’s Petition and its accompanying Appendix can be found here:

In our recent webinar, Ed Morrow and I anticipated a possible petition for a writ of certiorari and discussed it at length: Are Redemption Buy-Sell Agreements Using Life Insurance Still Effective After Connelly Estate v. United States? Why Clients and Advisors Need to Review Their Buy-Sell Agreements Right Now!

When the Supreme Court addresses the Petition, you can depend on the LISI team to bring you the news IMMEDIATELY!!!


Paul Hood


LISI Business Entities Newsletter #277 (August 29, 2023) at  Copyright 2023 L. Paul Hood, Jr.). All rights reserved. Reproduction in Any Form or Forwarding to Any Person Prohibited Without Express Permission. This newsletter is designed to provide accurate and authoritative information regarding the subject matter covered. It is provided with the understanding that LISI is not engaged in rendering legal, accounting, or other professional advice or services. If such advice is required, the services of a competent professional should be sought. Statements of fact or opinion are the responsibility of the authors and do not represent an opinion on the part of the officers or staff of LISI.

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