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relationship between sections 2031 and 1014, there is automatic
causality between the fair market value of shares reported by the
estate and the gain recognized on the sale of the same property.
The purpose of section 1014 is, in general, to provide a basis
for property acquired from a decedent that is equal to the value
placed upon such property for purposes of the Federal estate tax.
See sec. 1.1014-1(a), Income Tax Regs. Once the proper date-of-
death fair market value is established by judicial process and
made subject to the estate tax, it is automatic, under the facts
of this case, that gain has been improperly subjected to the
income tax. Accordingly, we find that the single transaction,
item, or taxable event requirement is met.
3. Inconsistent Treatment
Both the estate and the income tax depend upon the same
matter of fact--the fair market value of the shares at the date
of decedent's death. Accordingly, the value existing at
decedent's death is taxed only once. See secs. 1014, 2031.
With respect to this issue in Parker v. United States,
supra, the Court of Appeals for the Ninth Circuit compared the
facts of that case, in which there was an erroneous inclusion in
the stepfather's estate and an erroneous failure to assess the
full value of the mother's gross estate, with Bull v. United
States, 295 U.S. 247 (1935), in which the same amount of
partnership profits was taxed as both corpus and income. See
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