- 20 - Huntsman that a buyer would not pay more for stock based on the corporation's ownership of life insurance if the proceeds would be largely offset by the corporation’s liabilities. Id. at 875. That is the case here. In Estate of Clarke v. Commissioner, supra, we held that, in valuing the stock of a corporation, the taxpayer’s experts’ erred in not including the insurance policy on the life of the deceased taxpayer under which $39,675 was paid to the corporation. In Estate of Clarke, the corporation was not required to pay the proceeds to the taxpayer’s estate. In contrast, in the instant case, the life insurance proceeds were paid to the corporation, but they could not be used for working capital because they were to be paid to decedent’s estate. We conclude that the $5 million insurance proceeds do not increase the value of decedent’s CSB stock. We also conclude that the fact that CSB was the beneficiary of and owned the insurance proceeds does not determine whether CSB and decedent agreed that payment was made solely to redeem his stock, as petitioner contends, or partly to redeem his stock and partly for any claim for cases or work in process, as we have found. E. The Value of Decedent's CSB Stock on June 30, 1988 Petitioner contends that decedent's stock was worth $5,556,6158 when he died on June 30, 1988. Respondent contends 8 Petitioner computes the value of decedent’s stock as (continued...)Page: Previous 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 Next
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