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which the property would change hands between a willing buyer and
a willing seller, both having a reasonable knowledge of relevant
facts and neither being under any compulsion to buy or sell.
Sec. 1.170A-1(c)(2), Income Tax Regs. Fair market value is a
question of fact to be determined from the entire record. Zmuda
v. Commissioner, 79 T.C. 714, 726 (1982), affd. 731 F.2d 1417
(9th Cir. 1984); Estate of DeBie v. Commissioner, 56 T.C. 876,
894 (1971). The Commissioner's determination of the property's
fair market value is presumed to be correct, and petitioners bear
the burden of proving a higher value. Rule 142(a).
It is undisputed that Oceanus is a qualified entity.
Petitioners attempted to satisfy their burden of proving the
boat's fair market value principally through Mr. Sergeant's
testimony and the Hurt appraisal. We do not accept Mr.
Sergeant's unsubstantiated testimony regarding the boat. See
Wood v. Commissioner, 338 F.2d 602, 605 (9th Cir. 1964), affg. 41
T.C. 593 (1964). The Hurt appraisal based its value for the boat
on the BUC Guide. We do not place much weight on this appraisal.
Mr. Miller credibly testified that the BUC Guide inflates the
value of used boats and that the NADA Guide more accurately
reflects their fair market value. We note that many banks, for
financing purposes, no longer use the BUC Guide and instead use
the NADA Guide. Furthermore, petitioners did not offer Mr. Hurt
as a witness at trial, and respondent and the Court did not have
the opportunity to question him regarding the conclusions set
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