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decedent's estate on the date of death, or alternatively, just
the revised value of 106,826 shares of Brookshire common stock
subject to the stock-purchase agreement.
On the grounds of timeliness and prejudice, petitioner
objects to any increase in respondent’s proposed deficiency. We
regard as patently prejudicial respondent’s attempt, at trial, to
increase the value of the Brookshire common stock owned by
decedent's estate by $5,108,782 or by $1,678,237, and we shall
deny respondent’s motion.
OPINION
For Federal estate tax purposes, property is generally
included in a decedent’s gross estate at its fair market value on
the date of decedent's death. Sec. 2031(a); sec. 20.2031-1(b),
Estate Tax Regs. Fair market value is defined generally as the
price at which property would change hands between a willing
buyer and a willing seller, neither being under any compulsion to
buy or to sell and both having reasonable knowledge of relevant
facts. United States v. Cartwright, 411 U.S. 546, 551 (1973);
Rushton v. Commissioner, 498 F.2d 88, 89-90 (5th Cir. 1974),
affg. 60 T.C. 272 (1973); Estate of Gilford v. Commissioner, 88
T.C. 38, 48 (1987); sec. 20.2031-1(b), Estate Tax Regs.
Fair market value involves a question of fact. Estate of
Newhouse v. Commissioner, 94 T.C. 193, 217 (1990); Estate of
Andrews v. Commissioner, 79 T.C. 938, 940 (1982).
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