No, not those famous ones some of us have heard from childish lips around the festive board year after year.

This lot is what Judge Morrison poses to IRS and the trusty attorneys for Gerda Khouw, Donor, et al., Docket No. 11217-20, filed 1/27/26, There must be a lot als (hi, Judge Holmes), because here’s Judge Morrison’s preliminary take on the fact pattern.

“Under the 2014 Northern Trust master note, dated as of December 23, 2014, Northern Trust made $122,534,567 of advances that were used to pay the premiums on policies owned by the Tan Horse Trust. The Tan Horse Trust is an irrevocable life-insurance trust (ILIT). Under the provisions of the 2014 Northern Trust master note, the borrower (Gerda Khouw and the Survivor’s Trust, collectively) promised that the advances would be used to pay the premiums on the policies through the following chain of payments: (1) the borrower would contribute the advances to the Geona Trust, (2) the Geona Trust would contribute the amounts to GK Capital in exchange for a 99.98% limited partner interest in GK Capital, and (3) GK Capital would lend the amounts to the Tan Horse Trust to enable the Tan Horse Trust to make the premium payments.” Order, at p. 1. (References to stips omitted).

The parties are invited to correct, comment, agree, disagree. And of course there is a pledge agreement and collateral-assignment agreement back to Northern Trust. As Northern Trust’s website claims it has $1.8 trillion-with-a-T under management, this $122 million deal (and another $126 million mirror image a couple years later) is pocket change. 

Except to the parties, of course.

So let the parties dish on whether this is a split-dollar life insurance arrangement (see my blogpost “The Split,” 8/29/12 for some deep background). And if it is, what difference does that make?

If you’re the type who likes to get granular, go into the weeds, go nerd, or whatever the latest buzzwords might be, check out Order, at pp. 4-5. Judge Morrison overhauls statute and regs, and comes up with the aforesaid four questions. 

But if ever there was a case where the judge was telling the parties “You really don’t want me to decide this case, guys, so settle, OK?” this is that case. See Order, at pp. 5-6.