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FNBW
FNBW was a corporation that operated a bank in Pike County,
Ohio, that had been in decedent’s family for many years. On the
date of decedent’s death, there were 100,000 shares of FNBW
outstanding and 95 shareholders. Decedent owned 12,000 shares in
FNBW when she died. On December 31, 1992, 25 days before
decedent’s death, FNBW’s total assets were $103,884,000 and total
stockholder equity was $11,249,000. In the period from 1988
through 1992, FNBW’s earnings increased each year from $917,000
in 1988 to $1,423,000 in 1992. In the same period, its dividends
also increased each year from $348,000 in 1988 to $640,000 in
1992.
On the estate tax return, petitioner claimed a value for
decedent’s shares in FNBW of $73.67 per share. In the notice of
deficiency, respondent valued decedent’s shares in FNBW at
$159.53 per share.
ULTIMATE FINDING OF FACT
The fair market value of decedent’s 12,000 shares in FNBW at
the date of decedent’s death was $98 per share, or a total of
$1,176,000.
OPINION
We must decide the fair market value of decedent’s shares of
stock in JFI and FNBW on the date of decedent’s death on
January 25, 1993. Both parties rely upon expert opinions.
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