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The handbook, in relevant part, reads:
If you are comparing a Subchapter S Corporation to the
stock of similar firms that are publicly traded, the
net income of the former must be adjusted for income
taxes using the corporate tax rates applicable for each
year in question, and certain other items, such as
salaries. These adjustments will avoid distortions
when applying industry ratios such as price to
earnings.
Both statements lack analytical support, and we refuse to
interpret them as establishing respondent’s advocacy of tax-
affecting as a necessary adjustment to be made in applying the
discounted cash-flow analysis to establish the value of an
S corporation.
Even if we were to interpret the excerpts as petitioners do,
petitioners do not claim that the excerpts have the force of a
regulation or ruling, nor have they shown the type of detrimental
reliance that might work an equitable estoppel against
respondent. “Equitable estoppel is a judicial doctrine that
precludes a party from denying his own acts or representations
which induced another to act to his detriment. Estoppel is
applied against the Commissioner with utmost caution and
restraint.” Hofstetter v. Commissioner, 98 T.C. 695, 700 (1992)
(internal citations and quotation marks omitted). In any event:
“Detrimental reliance on the part of the party seeking to invoke
estoppel is a key condition.” Id. Petitioners have failed to
prove that they relied on either the guide or the handbook in any
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