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When performing the present value calculations, Ms. Simons
assumed two properties were marketed and sold every 4 months.
Ms. Simons used an average sales price for each of the properties
and discounted this price back to the date of decedent’s death
based on the time required to sell the properties. Because the
first two properties were assumed to sell within a normal
marketing period of 4 months, Ms. Simons did not discount these
prices back to present value.
3. Appropriate Blockage Discount
The parties disagree as to the appropriate method for
determining a blockage discount. Although we do not find
anything inherently wrong in Ms. Simons’ approach, we believe
that Mr. Talmage’s approach is the better determiner of the
appropriate blockage discount to apply in the present case. Cf.
Estate of Auker v. Commissioner, T.C. Memo. 1998-185 (wherein we
adopted an approach similar to Ms. Simons’ approach). Mr.
Talmage’s report is well reasoned and based on reliable
statistical data.
We find that 6 months was a reasonable marketing period for
properties in the Marina District. Not only do the MLS and Comps
data support such a finding, but we believe that Ms. Simons’
report also does. Ms. Simons’ report concludes that it would
take 3 to 4 months to list and either sell or escrow a property.
Mr. Talmage’s marketing period begins with the listing and ends
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