- 20 -
We start with the redemption price of $75.1555 because we
believe that it represents the arm’s-length value for all of
Eatel’s stock in August 1993. We adjust this price to account
for the passage of time, as well as the change in the setting
from the date of Decedent’s death to the date of the redemption
agreement. We also adjust this price to take into account the
marketability and minority discounts. In an ideal world, these
two discounts are computed separately, as are the alterations for
the change in setting. See Snyder v. Commissioner, 93 T.C. at
539. In the confines of our imperfect record, however, we are
unable to determine these discounts with any specificity and
choose to account for them and the other factors in the
aggregate. Based on the record, and with the benefit of our
common sense, knowledge, and experience, we find and conclude
that the redemption price must be reduced by 30 percent to
reflect the value of the subject shares on the date of Decedent’s
death. Accordingly, we hold that the date-of-death value is
$50.50885 per share.
We find no material alteration in the value of the shares
between the date of the gift and the date of death. Thus we find
that the date-of-gift value equals the date-of-death value.
Accordingly, we hold that the date-of-gift value is $50.50885 per
share.
Page: Previous 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 NextLast modified: May 25, 2011