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3. On its Form 706, U.S. Estate (and Generation-
Skipping Transfer) Tax Return, P valued D’s real estate
at $2,261,800. R determined that the fair market value
was $2,785,248. Held: The fair market value was
$2,417,491.
4. P elected special use valuation of certain
farm real property on its Form 706. R disallowed the
election because P failed to document comparable rental
property in accordance with sec. 2032A(e)(7), I.R.C.,
and the regulations thereunder. See sec. 20.2032A-4,
Estate Tax Regs. Held: P may not value its elected
properties under the valuation formula of sec.
2032A(e)(7), I.R.C. Held, further, by reason of sec.
20.2032A-4, Estate Tax Regs. (which provides that if an
executor does not identify comparable property and cash
rentals as required by sec. 2032A(e)(7), I.R.C., all
specially valued real property must be valued under the
rules of sec. 2032A(e)(8), I.R.C.), P may value the
properties under the provisions of sec. 2032A(e)(8),
I.R.C. Held, further, P’s special use valuation under
sec. 2032A(e)(8), I.R.C., is allowed.
John W. Ambrecht and Gregory Arnold, for petitioner.
Steven M. Roth, for respondent.
MEMORANDUM FINDINGS OF FACT AND OPINION
MARVEL, Judge: Respondent determined an estate tax
deficiency of $775,626 and an addition to tax under section 6662
of $3,844. After concessions,1 the issues for decision are:
1The parties conceded several items in a stipulation of
agreed adjustments, filed Sept. 14, 1998. Petitioner's
concessions are described therein and will not be repeated here.
Respondent has conceded that petitioner is not liable for the
addition to tax. On brief, respondent conceded that the fair
market values of decedent's interests in two parcels of estate
(continued...)
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