Estate of Charles K. McClatchy, Deceased, William K. Coblentz and James McClatchy, Personal Representative - Page 11

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               Petitioner cites and strongly relies upon our decision in              
          Estate of Harper v. Commissioner, 11 T.C. 717 (1948).  Petitioner           
          cites Harper to support the proposition that for estate tax                 
          purposes the value that is transferred under section 2033 is the            
          realizable value of an asset during decedent's life and no more.            
               Section 2033 provides:                                                 
               Sec. 2033.  Property In Which The Decedent Had An                      
               Interest.                                                              
                    The value of the gross estate shall include the value             
               of all property to the extent of the interest therein of the           
               decedent at the time of his death.                                     
               Petitioner states on brief that "In Harper the Court faced             
          the precise issue of this case".  We do not agree.                          
               On the surface, some of the words of Harper might, when read           
          out of context, appear to support petitioner's position.  There             
          we concluded our Opinion by saying that                                     
               At the time of her death the decedent had an interest                  
               in notes the value of which did not exceed the value of                
               the assets held as security therefor plus the net worth                
               of the makers, and that is the interest which ceased at                
               her death.  We hold that the petitioner correctly                      
               returned the value of the interest of the decedent in                  
               the notes at the time of her death for estate tax                      
               purposes.  [11 T.C. at 720.]                                           
          This passage was in response to an argument by the Commissioner             
          that the value of the notes was enhanced because immediately upon           
          the death of the decedent the makers of the notes, who were also            
          Harper's heirs, became invested with more than sufficient assets            
          to satisfy their obligation.  Id.                                           





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