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income tax returns for Martin and Arnold during this same period. He
also represented petitioner before the IRS in the audit that preceded
the issuance of the deficiency notice at issue in this case.
Respondent argues that these prior relationships so infect Mr.
Bergwerk’s report with bias that we should completely disregard it.
The mere existence of the relationships does not automatically
disqualify Mr. Bergwerk as petitioner’s expert. See, e.g., Estate of
Bennett v. Commissioner, T.C. Memo. 1993-34 (appraiser was a longtime
family adviser and was a coexecutor of the estate). Nor is Mr.
Bergwerk automatically disqualified by his lack of formal
qualifications as an appraiser. Id. (citing Fed. R. Evid. 702; Grain
Dealers Mut. Ins. Co. v. Farmers Union Coop. Elevator & Shipping
Association, 377 F.2d 672, 679 (10th Cir. 1967)).
In Estate of Halas v. Commissioner, supra at 578, we stated that
an “appraiser’s duty closely corresponds to the public duty of an
auditor or certified public accountant.” On the basis of the nature
of the report, which we discuss infra, Mr. Bergwerk’s professional
qualifications as a certified public accountant, and the testimony of
Mr. Bergwerk, we are satisfied that Mr. Bergwerk was not acting as a
mere advocate for petitioner, but as an appraiser with a duty to the
Court. Id. at 577. However, we do not ignore or disregard this prior
and continuing relationship between Mr. Bergwerk and petitioner,
Arnold, and Martin and weigh it in the balance of whether--and the
degree to which--to accept Mr. Bergwerk’s expert opinion.
Mr. Bergwerk stated that he had based his report on the
methodology set forth in Rev. Rul. 59-60, 1959-1 C.B. 237, modified by
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