A son-in-law moved 98 percent of a dying Texan's fortune into a family partnership the day after a "Fortress Plan" seminar, and the IRS taxed all of it

Albert Strangi signed a power of attorney in 1988 naming his son-in-law, Michael Gulig, as his agent. In 1993 Strangi had surgery for a cancerous mass on his back and was diagnosed with supranuclear palsy, and Gulig took over his affairs. Gulig attended a seminar on the "Fortress Plan." The next day, 12 August 1994, he formed the Strangi Family Limited Partnership. He moved $9,932,967 of Strangi's assets, more than 98 percent of his wealth, into it in exchange for a 99 percent limited partner interest. A company, Stranco, held the 1 percent general partner interest and ran the partnership; Strangi owned 47 percent of Stranco and each of his four children 13 percent. Strangi kept $762 in liquid assets. He went on living in one of the houses. He died on 14 October 1994. The partnership paid about $40,000 toward his funeral and debts and $3,187,800 in 1995 for estate and inheritance taxes. The estate, run by his daughter Rosalie Gulig^†, reported the partnership interest at $6,560,730 after discounts. The IRS valued it at $10,947,343 and claimed $2,545,826 more tax. The estate won the first round in the Tax Court. The IRS appealed, the Tax Court ruled for the IRS on remand, and on 15 July 2005 the Fifth Circuit held that Strangi had kept the use of the assets and that the partnership had no substantial non-tax purpose. The full value went into his taxable estate.