Laura Cunningham (Cardozo) has posted The FLP, the Transfer Taxes, and the Income Tax, 127 Tax Notes ___ (May 2010), on SSRN.  Here is the abstract:

Despite repeated calls for reform, Congress has declined to act to curb transfer tax avoidance through the use of family limited partnerships (“FLP’s"). Use of FLP’s allows taxpayers to substantially leverage their exemption from estate tax, and reduce the effective rate of tax on even the most liquid investment assets. This article reviews the current state of the law in the Tax Court on FLP’s, renews the call for Congressional action, and explains why FLP’s are not just a “death tax” problem.