- 14 - Petitioner presented the expert testimony of a real estate appraiser, Bruce Hatfield, to the effect that the value of the property decreased in 1989 from about $11 million to $1 million as a result of the 1989 Manual and MOA. Mr. Hatfield's valuation is based on his conclusion that the highest and best use of the Elbow Lake property is residential development and that the property could be rezoned from agricultural to residential. The fair market value of property is a question of fact for which the burden of proof is on petitioner. Symington v. Commissioner, 87 T.C. 892, 896 (1986). The fair market value of property is based on the highest and best use for the property on the date of valuation regardless of whether the property is actually being used for that purpose or the land owner intended to put the property to that use. Frazee v. Commissioner, 98 T.C. 554, 563 (1992); Stanley Works v. Commissioner, 87 T.C. 389, 400 (1986). Rather, "The realistic, objective potential uses" of the property control. Stanley Works v. Commissioner, supra at 400. The highest and best use is a reasonable and probable use of the property in the near future. Frazee v. Commissioner, supra. Restrictions on a land owner's right to use the property are relevant in determining whether the identified highest and best use of the property is reasonable. Stanley Works v. Commissioner, supra at 402. Accordingly, petitioner must prove that it was reasonable and probable that the Elbow Lake propertyPage: Previous 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 Next
Last modified: May 25, 2011