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affd. without published opinion 91 F.3d 124 (1996). Indeed, a
right of first refusal without a fixed price does not limit the
buyers to whom a seller could sell the interest or the price for
the interest, but merely governs the order in which prospective
buyers must stand in line to purchase. Mandelbaum v.
Commissioner, supra. Given the fact that such a right actually
protects and benefits the other partners, the depressant effect
(if any) upon the value of a privately held partnership interest
subject to a right of first refusal is not necessarily
substantial.
Overall, from our perspective, Zitelman's report lacks a
wholly objective analysis of the willing buyer/willing seller
standard. Consequently, we do not find the report as compelling
as petitioner suggests. Rather, Zitelman focuses exclusively
upon the hypothetical willing buyer. Zitelman failed to consider
whether a hypothetical seller would sell his or her interest in
the partnership for $399,000. The test of fair market value
rests upon the concept of a hypothetical willing buyer and a
hypothetical willing seller. We find incredible the proposition
that any partner, limited or general, would be willing to sell
his or her interest for such a low amount as to generate an
internal rate of return of approximately 15 percent to 22
percent. Ignoring the views of a willing seller is contrary to
this well-established rule. Id. In this regard, Zitelman's
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