Allen M. Glick - Page 29

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          development profits.  This offer is reasonably close to Mr.                 
          Handverger's appraisal of the Property and the figure used by               
          petitioner on his 1986 income tax return.                                   
          Section 6659 Valuation Overstatement Addition to Tax                        

               Respondent also determined that petitioner was liable for a            
          section 6659 addition to tax for a valuation overstatement.  A              
          valuation overstatement exists if the value of any property or              
          the adjusted basis of any property claimed on a return exceeds              
          150 percent of the amount determined to be the correct amount.              
          Sec. 6659(c).  With respect to charitable deduction property, the           
          amount of the addition to tax is equal to 30 percent of the                 
          underpayment.  Sec. 6659(f)(1).  On his return, petitioner                  
          claimed that the fair market value of the property was $12                  
          million.  We have determined that the property's fair market                
          value was actually $10,970,000.  Therefore, petitioner did not              
          overstate the fair market value of the property by 150 percent              
          ($10,970,000 x 150% = $16,455,000), and he is not liable for the            
          overvaluation addition to tax.                                              

          Increased Interest                                                          

               Respondent also determined that petitioner was liable for              
          additional interest pursuant to section 6621(c).  Section 6621(c)           
          provides for an interest rate of 120 percent of the adjusted rate           
          established under section 6621(b) if there is a "substantial                





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