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appropriate inferences. Commissioner v. Scottish Am. Inv. Co.,
323 U.S. 119, 123-125 (1944); Helvering v. Natl. Grocery Co.,
304 U.S. 282, 294 (1938); Zmuda v. Commissioner, 79 T.C. 714, 726
(1982), affd. 731 F.2d 1417 (9th Cir. 1984); Mandelbaum v.
Commissioner, T.C. Memo. 1995-255, affd. without published
opinion 91 F.3d 124 (3d Cir. 1996). Fair market value is the
price that a willing buyer would pay a willing seller, both
persons having reasonable knowledge of all relevant facts and
neither person being under any compulsion to buy or to sell.
United States v. Cartwright, 411 U.S. 546, 551 (1973); Kolom v.
Commissioner, 644 F.2d 1282, 1288 (9th Cir. 1981), affg. 71 T.C.
235 (1978); Estate of Hall v. Commissioner, 92 T.C. 312, 335
(1989). See generally Rev. Rul. 59-60, 1959-1 C.B. 237. The
willing buyer and the willing seller are hypothetical persons,
rather than specific individuals or entities, and the
characteristics of these hypothetical persons are not necessarily
the same as the personal characteristics of the actual seller or
a particular buyer. Propstra v. United States, 680 F.2d 1248,
1251-1252 (9th Cir. 1982); Estate of Bright v. United States,
658 F.2d 999, 1005-1006 (5th Cir. 1981); Estate of Jung v.
Commissioner, 101 T.C. 412, 437-438 (1993); Mandelbaum v.
Commissioner, supra.
Fair market value reflects the highest and best use of the
relevant property on the valuation date and takes into account
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