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that Sarah’s 17/65 interest had a date of death fair market value
of $1,290,211.
OPINION
We consider here circumstances where a married couple die
within 1 year of each other. Each decedent, at the time of his
or her death, held a partial interest in a family trust. The
trust, in turn, held 16 parcels of timberland. The parties agree
on the fair market value of the 16 parcels of timberland on the
date of each decedent’s death. The controversy centers on the
amount of discount applied where each decedent held a fractional
interest through the family trust.
Generally, the estates have approached valuation by means of
what they consider to be comparable sales of fractional
interests. On the basis of the relatively limited universe of
the sales of partial interests in timberland, the estates’
experts have opined that discounts should range from 55 percent
to as much as 90 percent. Respondent agrees that some discount
is appropriate, but he contends that the size of the discounts
proposed by the estates is excessive and that the estates’
experts are merely advocates for petitioners’ position.
Valuation of a property interest for Federal estate tax
purposes is a factual question. See Estate of Bonner v. United
States, 84 F.3d 196, 197 (5th Cir. 1996); Sammons v.
Commissioner, 838 F.2d 330, 333 (9th Cir. 1988), affg. on this
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