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and Maude's estates reflected the 1980 Gifts as reported by Royal
and Maude on their respective 1980 gift tax returns. The period
of limitations on assessment of additional estate tax against
Royal's estate has expired.
G. Notices of Deficiency
On March 11, 1996, respondent issued three deficiency
notices: (i) For gift tax for the period ending September 30,
1981, to Maude G. Furman, donor, deceased, Estate of Maude G.
Furman, deceased, and Robert G. Furman, Executor (the Maude Gift
Tax Notice); (ii) for estate tax to the Estate of Maude G.
Furman, deceased, and Robert G. Furman, Executor (the Estate Tax
Notice); and (iii) for gift tax for the period ending
September 30, 1981, to Royal G. Furman, donor, deceased, Estate
of Royal G. Furman, deceased, Robert G. Furman, Executor (the
Royal Gift Tax Notice).
The Estate Tax Notice determined that the fair market value
of the shares transferred by each decedent in the 1980 Gifts was
$147,600 ($24,600 per share), rather than the $62,016 ($10,366
per share) that they had reported on their 1980 gift tax returns.
Both the Maude Gift Tax Notice and Royal Gift Tax Notice
determined that the fair market value of the 24 shares of FIC
common stock exchanged by each decedent in the Recapitalization
was $540,540 ($22,522 per share), while the 3,000 shares of
preferred stock received by each decedent in the Recapitalization
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