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county zoning commission would deny commercial access from Cahaba
River Road through the zone. The effect, petitioner suggests, is
indistinguishable from the contractual agreement between the
county zoning commission and Bell preventing Bell from
constructing a road connecting its property to Cahaba River Road.
The mere fact that the current zoning restrictions of a
parcel of real estate do not permit a particular use does not
necessarily preclude a consideration of the unpermitted use when
conducting a highest and best use analysis. Frazee v.
Commissioner, 98 T.C. at 564. When there is a reasonable
probability that the zoning regulations will change within the
near future, such change can be considered in the determination
of value. Id. (citing Investors Funding Corp. v. Bloor, 592 F.2d
134, 136 (2d Cir. 1979); Estate of Pattison v. Commissioner, T.C.
Memo. 1990-428). For example, in Estate of Wolfe v.
Commissioner, a Memorandum Opinion of this Court dated Jan. 15,
1954, the status of a rezoning was on appeal on the date of
valuation. We noted that, while the property could not properly
be valued as though the rezoning had already been completed, the
fact that a change in zoning was in prospect was an element
deserving of consideration in the process of determining value.
Id.
We have little doubt that there existed at the time of
decedent's death a reasonable probability that parcel A could be
rezoned from residential to commercial. In fact, considering the
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