Estate of H.A. True, Jr. - Page 23




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          that he only reviewed the B. Allen report in connection with                
          subsequent litigation, not at the time of the gifts.                        
               We reject any notion that Mr. Harris was qualified to opine            
          on the reasonableness of using the tax book value formula in the            
          True family buy-sell agreements.  Mr. Harris was closely                    
          associated with the True family; his objectivity was                        
          questionable.  More importantly, he had no technical training or            
          practical experience in valuing closely held businesses.  The               
          record shows no technical basis (in the form of comparables,                
          valuation studies, projections) for Mr. Harris’s assertion that             
          tax book value represented the price at which property would                
          change hands between unrelated parties.  In Lauder II, we were              
          troubled by the fact that the decedent’s son settled on a book              
          value formula after having consulted with only a close family               
          financial adviser.  Similarly, in Bommer Revocable Trust v.                 
          Commissioner, T.C. Memo. 1997-380, we found it significant that             
          the decedent consulted only with his attorney, who spent 1 day              
          calculating the buy-sell agreement’s fixed transfer price.  On              
          the basis of the record evidence, we find that Dave True’s                  
          discussions with Mr. Harris were insufficient to assess                     
          objectively and accurately the reasonableness of using a tax book           
          value formula price for the True companies’ buy-sell agreements.            










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