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denied, then we will need the following within the next
60 days:
a. Who did this calculation submitted with the
706?
b. If there are any other data to support it,
please submit copies.
c. It appears that the valuation is based upon
what deceased received on her ranching operations.
Please supply copies of those leases.
d. Please comply with Regulation 20.2032A-4 (copy
enclosed for your convenience) that requires
documentation which identifies specific comparable
rentals and taxes for five years prior to date of
death, arms length transactions, to determine the
net rents. (I am also enclosing a copy of the Tax
Management discussion and example of how special
valuations must be done in order to qualify.) The
Farm Credit Bank rate for the Sacramento
District for 1992 was 11.50%. (See copy of Revenue
Ruling 92-12 enclosed.) A rate cannot be
“assumed”.
e. If the appropriate documentation for the
special use valuation is not supplied, the
$750,000 reduction will be disallowed, see
Strickland, 92 TC 16, copy enclosed.
At a meeting with the estate's attorney, Richard Weldon, and
the coexecutors on September 21, 1995, Ms. Hiles described the
requirements of electing special use valuation pursuant to
section 2032A(e)(7). Ms. Hiles did not mention section
2032A(e)(8) because she did not believe the estate could properly
elect special use valuation under that section. After the
meeting, Ms. Hiles extended the period for supplying the
requested information to 90 days. On December 12, 1995 (within
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