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<p class="MsoNormal"><a name="_GoBack"></a>Two brothers (A and B) are to inherit equally the entire ownership in LLC, which owns a single building (say building has fair value of $1million). There are no other assets in the estate. Brother A offers instead
of the estate distributing his 50% to him, he will sell to Brother B. Per WAC 458-61a-101(4)(c), this is a taxable event due to controlling interest and the selling price is $1 million, the
<u>full</u> fair value of the building. Anyone disagree? If agreed, if LLC first distributes real estate to Brothers A and B to hold as tenants in common and then A sells his 50% interest in the real estate to B, the excise tax is at the sales price ($500k),
correct? Anything wrong with the PR making the distribution first from the LLC to avoid the imposition of the higher excise tax?<o:p></o:p></p>
<p class="MsoNormal"><o:p> </o:p></p>
<p class="MsoNormal" style="text-align:justify"><span style="font-size:10.0pt;font-family:"Arial","sans-serif"">Marcus J. Fry<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:10.0pt;font-family:"Arial","sans-serif"">Lyon, Weigand & Gustafson, P.S.
<o:p></o:p></span></p>
<p class="MsoNormal"><span style="font-size:10.0pt;font-family:"Arial","sans-serif"">P.O. Box 1689
<br>
Yakima, Washington 98907 <br>
Telephone: (509) 248-7220 <br>
Facsimile: (509) 575-1883 <o:p></o:p></span></p>
<p class="MsoNormal" style="text-align:justify"><b><u><span style="font-size:10.0pt;font-family:"Arial","sans-serif""><o:p><span style="text-decoration:none"> </span></o:p></span></u></b></p>
<p class="MsoNormal" style="text-align:justify"><b><u><span style="font-size:10.0pt;font-family:"Arial","sans-serif"">NOTICES:<o:p></o:p></span></u></b></p>
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