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indirectly by reference to the subject corporation's net worth,
its prospective earning power, its dividend-earning capacity, its
goodwill, its management, its position in the industry, the
economic outlook for its industry, and the degree of control
represented by the block of its stock to be valued. See
Estate of Hall v. Commissioner, supra at 336; Estate of Andrews
v. Commissioner, supra at 940; sec. 20.2031-2(f), Estate Tax
Regs.; see also Estate of Lauder v. Commissioner, T.C. Memo.
1994-527.
When determining the value of unlisted stock by reference to
the value of listed stock, a discount from the listed value is
typically warranted in order to reflect the lack of marketability
of the unlisted stock. Mandelbaum v. Commissioner, supra. Such
a discount, namely, a "lack of marketability discount" (or, more
succinctly, a "marketability discount"), generally reflects the
absence of a recognized market for closely held stock and
accounts for the fact that closely held stock is generally not
readily transferable. See Estate of Hall v. Commissioner, supra;
Estate of Gilford v. Commissioner, supra. A marketability
discount also reflects the fact that a buyer may have to incur a
subsequent expense to register the unlisted stock for public
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