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OPINION
Generally, the fair market value of property transferred by
a decedent with respect to which the decedent retains for life
the right to income from the property is includable in the gross
estate. Sec. 2036(a)(1). Fair market value is defined generally
as "the price at which the property would change hands between a
willing buyer and a willing seller, neither being under any
compulsion to buy or to sell and both having reasonable knowledge
of relevant facts." United States v. Cartwright, 411 U.S. 546,
551 (1973); sec. 20.2031-1(b), Estate Tax Regs.
In determining the fair market value of property includable
in a decedent's gross estate, we are to consider all relevant
facts and circumstances. Cartwright v. United States, 457 F.2d
567, 571 (2d Cir. 1972), affd. 411 U.S. 546 (1973); Estate of
Andrews v. Commissioner, 79 T.C. 938, 940 (1982); sec. 20.2031-
1(b), Estate Tax Regs.
In determining the fair market value of decedent's ownership
unit in the FC Partnership, petitioner's and respondent's expert
witnesses agree that discounts are appropriate to reflect the
minority status and the lack of marketability of decedent's one
ownership unit. See Richardson v. Commissioner, 151 F.2d 102,
105 (2d Cir. 1945), affg. a Memorandum Opinion of this Court
dated Nov. 30, 1943; Estate of Newhouse v. Commissioner, 94 T.C.
193, 249 (1990); Harwood v. Commissioner, 82 T.C. 239, 267-268
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Last modified: May 25, 2011