Estate of Frederick Carl Gloeckner, Deceased, Joseph A. Simone, and Douglas Dillon, Co-Executors - Page 1

                                 T.C. Memo. 1996-148                                  

                               UNITED STATES TAX COURT                                

                         ESTATE OF FREDERICK CARL GLOECKNER,                          
                          DECEASED, JOSEPH A. SIMONE, AND                             
                     DOUGLAS DILLON, CO-EXECUTORS, Petitioner v.                      
                    COMMISSIONER OF INTERNAL REVENUE, Respondent                      

               Docket No. 8747-94.                  Filed March 25, 1996.             

                    R determined a deficiency in Federal estate tax                   
               liability.  R contends that decedent’s executors                       
               underreported the value of certain shares of stock in a                
               closely held corporation that D held on the date of his                
               death.  Those shares were subject to a restrictive                     
               agreement that obligated decedent’s executors to sell,                 
               and the company to buy, a certain number of shares.  R                 
               contends that the value of D’s shares is $4,580,000.                   
               The executors contend that the value of those shares is                
               $2,298,161.25, which is the amount received by the                     
               estate pursuant to the restrictive agreement.                          
                    1.  Held:  The price term in the restrictive                      
               agreement does not control the value of the stock for                  
               Federal estate tax purposes.                                           
                    2.  Held, further, the value of the stock for                     
               Federal estate tax purposes is $4,000,000.                             

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