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discount rate of 12.5 percent to the partition proceeds less the
partition costs of these properties.6
3. Conclusion
The parties’ arguments center upon the correct method for
determining a fractional interest discount. Courts have often
looked at costs to partition in determining an appropriate
fractional interest discount. Courts, however, consider other
factors, such as the historical difficulty in selling these
interests and lack of control. See Estate of Pillsbury v.
Commissioner, T.C. Memo. 1992-425.
Given the limited scope of Ms. Simons’ analysis, we find Mr.
Talmage’s report to be more persuasive in determining the
fractional interest discount. We conclude that a 20-percent
fractional interest discount is appropriate.
To the extent not herein discussed, we have considered the
parties’ other arguments and found them to be meritless.
To reflect the foregoing,
Decision will be entered
under Rule 155.
6 It is unclear why Ms. Simons chose to use the 12.5-
percent discount rate utilized in her blockage discount model as
opposed to the 6.5-percent discount rate used for 101 Capra.
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