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sold on March 4, 1994, at a per share price equal to the per
share price shown on the estate's Federal estate tax return. As
to the March 4, 1994, stock sale, the estate is, in essence,
arguing that the sale is indicative of what a willing buyer would
have paid for the stock on the valuation date given the income
tax liability inherent in the aforementioned property.
Respondent makes several arguments for disallowing a built-
in capital gains discount. First, respondent argues that the
estate has not established that a liquidation of the corporations
or the sale of the corporations' assets was likely to occur.
Among other things, respondent contends that the estate has
failed to show that the condemnation of the subject properties
was foreseeable on the valuation date, and that the evidence
establishes that legislative action to condemn the property was
not taken until August 12, 1993, more than 5 months after the
valuation date. Second, respondent argues that the discount is
not warranted where only the real estate, and not the
corporations, was subject to condemnation. Third, respondent
argues that the discount is not warranted where both corporations
could avoid, and did indeed avoid, the recognition of gain under
section 1033.
As previously stated, ordinarily a sale within a reasonable
time before or after the valuation date is the best criteria of
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