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respondent determined that the value of decedent’s 50 shares of
C&L Bailey stock was $9,025 per share, yielding the $451,263
total value determined in the notice of deficiency. Respondent
used the identical approach in valuing at $451,263 the 50 shares
of C&L Bailey stock includable in the gross estate under section
2044.
The Promissory Note
In the notice of deficiency, respondent determined that
decedent’s estate tax return improperly treated the promissory
note as decedent’s and Melba’s jointly owned property and
improperly reported a half interest in the note as includable in
the gross estate; accordingly, respondent reduced the gross
estate by $74,350. Respondent further determined that upon
assignment of the promissory note to three of his children in
1995, decedent had made three taxable gifts totaling $118,700
(after allowance for three $10,000 annual exclusions).
Other Taxable Gifts
In the notice of deficiency, respondent also determined that
decedent had made unreported taxable gifts of $20,000 and $10,000
in 1989 and 1993, respectively. The notice of deficiency
contains no other explanation of this determination or
description of the alleged unreported gifts or of the alleged
donees.
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