Estate of Eileen K. Brocato - Page 17




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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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