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consideration of a liquidity discount of the class A voting stock
($331,595.70 per share) to that of the class B nonvoting stock
($5,695.09 per share), that is a ratio of approximately 58 to 1.
This disparity is the consequence of the unique capital structure
of J.R. Simplot Co. and the skewed ratio of the number of class A
voting shares to the class B nonvoting shares, that is,
approximately 1 to 1,848.
Issue 3. Marital Deduction
The next issue is the amount of the section 2056 marital
deduction to be allowed the estate.
Decedent bequeathed all of his class A voting stock, and so
much of the class B nonvoting stock as, when added to the value of
the voting stock, equaled the Federal estate tax return filing
requirement in effect at the time of his death (i.e., $600,000) to
the trustees of a testamentary trust for the benefit of his
children (the credit shelter trust). The residue of decedent's
estate was bequeathed to his wife.
Decedent's will provides: (1) Decedent's personal
representative is to pay all State transfer and inheritance taxes
payable by reason of a bequest or devise to a devisee and to charge
the amount paid against the distributive interest of that devisee,
and (2) all Federal estate taxes imposed against the estate are to
be paid out of the residue that passes to decedent's wife.
In the notice of deficiency, respondent reduced the amount
reported for the marital deduction from $15,127,237 to $1,723,437.
The amount of this reduction ($13,403,800) is due to respondent's
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