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point and revg. in part on another ground T.C. Memo. 1986-318.
The fair market value of a property interest is determined under
the “willing buyer-willing seller standard” set forth in section
20.2031-1(b), Estate Tax Regs., as follows:
The fair market value is the price at which the
property would change hands between a willing buyer and
a willing seller, neither being under any compulsion to
buy or sell and both having reasonable knowledge of
relevant facts. The fair market value of a particular
item of property includible in the decedent’s gross
estate is not to be determined by a forced sale price.
Nor is the fair market value of an item of property to
be determined by the sale price of the item in a market
other than that in which such item is most commonly
sold to the public, taking into account the location of
the item wherever appropriate * * *.
It is implicit that the buyer and seller have knowledge of
all the relevant facts concerning the valuation property. United
States v. Cartwright, 411 U.S. 546, 551 (1973). It is also
implicit that the buyer and seller would aim to maximize profit
and/or minimize cost in the setting of a hypothetical sale. See
Estate of Watts v. Commissioner, 823 F.2d 483, 486 (11th Cir.
1987), affg. T.C. Memo. 1985-595; Estate of Newhouse v.
Commissioner, 94 T.C. 193, 218 (1990). Therefore, we consider
the view of both the hypothetical buyer and seller. Kolom v.
Commissioner, 644 F.2d 1282, 1288 (9th Cir. 1981), affg. 71 T.C.
235 (1978).
The estates offered three expert witnesses, and respondent
offered one. The estates’ experts were found to be qualified,
and their reports were received as their direct testimony in
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