Estate of John L. Baird, Deceased, Ellen B. Kirkland and J. Samuel Baird, Co-Executors - Page 12




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          finding that partition was not a viable alternative.  That                  
          evidence, however, was not made available to respondent during              
          the administrative or pretrial portions of the proceeding.8                 
               Significantly, the estates increased the amount of discount            
          claimed from 25 to 50 percent, from 50 to 60 percent, and,                  
          finally, from 60 to 90 percent.  Each claimed discount was                  
          supported by an opinion of an expert hired by the estates.  No              
          facts or legal principles changed from the time the 25-percent              
          discount was claimed to the time the 90-percent discount was                
          claimed.  Considering those circumstances, the Commissioner’s               
          failure to change his position, settle, or accept the estates’              
          position does not appear to be unreasonable.  In particular,                
          values or discounts reported or claimed on an estate tax return             
          may be considered admissions and, to some extent binding or                 
          probative and may not be overcome without cogent proof that such            
          admissions are wrong.  Estate of Hall v. Commissioner, 92 T.C.              
          312, 342 (1989); Estate of Pillsbury v. Commissioner, T.C. Memo.            
          1992-425; Estate of McGill v. Commissioner, T.C. Memo. 1984-292.            
               The facts that are relevant in valuation cases are those               
          that would be attributed to a hypothetical knowledgeable seller             
          and buyer.  United States v. Cartwright, 411 U.S. 546, 551                  


               8 We note that the estates’ representatives refused to meet            
          with Appeals and/or respondent’s counsel unless the Government              
          representatives agreed, in advance, to minimum discounts of 45              
          and 70 percent, respectively.                                               





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