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(indeed be substantially less than) unrestricted fair market
value.
Respondent also argues that the ranchland exchange
transactions among True Oil, True Ranches, and Smokey Oil,
discussed supra pp. 55-59, reflected petitioners’ attempts
artificially to reduce tax book value through aggressive tax
planning (i.e., petitioners were “double-dipping”). Respondent
suggests that even if these transactions were efficacious income
tax planning techniques--which the Court of Appeals for the Tenth
Circuit held they were not--their effect was to minimize or
eliminate tax book value of certain assets so that Dave True
could transfer interests in the affected True companies for less
than adequate and full consideration. We agree.
Courts have evaluated conduct after the agreement date when
intervening events within the parties’ control caused a wide
disparity between the buy-sell agreement’s formula price and fair
market value. See St. Louis County Bank v. United States, 674 F.
2d at 1211; Estate of Rudolph v. United States, 93-1 USTC par.
60,130, at 88449-88450, 71 AFTR 2d 93-2169, at 93-2176 through
93-2177 (S.D. Ind. 1993). Here, the ranchland exchange
transactions were clearly within the True family’s control. In
addition, because of those transactions, True Ranches received
ranchland properties with substantial fair market value and a
zero tax book value, while the high basis assets received by
Smokey Oil could be expected to be written down for tax purposes.
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