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On audit, based solely on the book-value-based formula set
forth in the stock-purchase agreement, respondent determined
that, on the date of decedent’s death, the total value of 106,826
shares of Brookshire common stock (consisting of the 60,743
shares owned directly by decedent’s estate and 46,083 of the
158,967 shares owned indirectly by decedent’s estate) was
$7,844,233 or $73.43 per share. Respondent accepted the $58.75
per-share value of the remaining 112,884 shares of Brookshire
common stock owned indirectly by decedent’s estate as reported on
decedent’s Federal estate tax return (for a value of $6,631,935).
Respondent determined the total value of all of the shares of
Brookshire common stock owned by decedent’s estate to be
$14,476,168.
In a report exchanged a few weeks before the trial herein,
respondent's expert opined that the value of the shares of
Brookshire common stock owned by decedent’s estate was $89.14 per
share or a total value for all shares of $19,584,950,
representing an increase of $5,108,782 over the value determined
by respondent in the notice of deficiency.
At the conclusion of the trial and based on the increase to
$89.14 per share that was reflected in respondent’s expert’s
report, respondent orally moved to amend the answer herein to
increase the deficiency in an unspecified amount reflecting the
total revised value of the Brookshire common stock owned by
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Last modified: May 25, 2011