Imagine you are a judge on the Court of Appeals for the Ninth Circuit, and you need to rule in Schott v. Commissioner. The taxpayers and the Service are disputing the gift tax owed on two grantor retained annuity trusts (GRATs), and the taxpayers have appealed to your court. The controversial portion of the GRATs is the annuity paid to the spouse if she survives the grantor. The Service argues to you, the judge, that this annuity will not reduce the value of the taxable gifts because it is not a qualified interest under section 2702. To resolve the dispute and rule on the case, you do some research on section 2702. You look to the regulations under section 2702 and find internal inconsistencies, a complex line of legislative history, and an example that has been declared invalid by the courts. You look to the Service’s published guidance, and you find that the Service has revoked its prior approval of these interests and changed course to challenge them. You look to the courts, and you find multiple approaches and multiple answers. Hovering in the background is the Seventh Circuit’s opinion in Cook v. Commissioner, which found the same type of interest invalid and introduced a new requirement that qualified interests be noncontingent. After finding this maze, you would probably prefer to step back and simply determine whether the Schotts’ interests were easily valued. If so, they should be qualified. It is thus no surprise that the Ninth Circuit did just that in finding for the taxpayer and only briefly addressed some of the minutia of section 2702. To meet the challenges of applying section 2702, the court carved out an exception for life estates, and it summarily included two-life annuities in the definition of term-holder. The court also narrowly avoided the result in Cook by distinguishing it based on an insignificant fact, even though the language of its opinion clashes with the Cook approach. Although a big-picture view may be appropriate, the court’s treatment of Cook and the regulations leaves unanswered questions and an opportunity for future courts to clarify the law.This Note pursues those questions and suggests that in the future courts should disregard Cook in order to make sense of section 2702. Part I introduces the Code and regulations defining a qualified interest. Part II discusses the facts, reasoning, and holding of the Tax Court opinion as well as the Ninth Circuit’s reversal. Part III analyzes (1) how the Service and precedent led the Ninth Circuit to such a fact-specific holding, (2) the remaining unanswered questions and how the court could have resolved them, and (3) what this decision means for future GRATs. Part IV urges future courts to fill in the gaps left by the Schott court by clarifying Example 7 of the regulations and modifying the contingency test.