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OPINION
A. Valuation of Decedent’s 50 Shares of C&L Bailey Stock
The value of a decedent’s gross estate includes “the value
at the time of his death of all property, real or personal”.
Sec. 2031(a). The relevant value is “the price at which the
property would change hands between a willing buyer and a willing
seller, neither being under any compulsion to buy or to sell and
both having reasonable knowledge of relevant facts.” Sec.
20.2031-1(b), Estate Tax Regs; see United States v. Cartwright,
411 U.S. 546, 551 (1973). See generally Rev. Rul. 59-60, 1959-1
C.B. 237. The fair market value of property reflects its highest
and best use on the valuation date. Mitchell v. United States,
267 U.S. 341, 344-345 (1925); Frazee v. Commissioner, 98 T.C.
554, 563 (1992); Symington v. Commissioner, 87 T.C. 892, 896
(1986).
The parties disagree about the date-of-death value of
decedent’s 50 shares of C&L Bailey stock. They also disagree
about the value of the 50 shares of QTIP property includable in
decedent’s gross estate under section 2044. It is undisputed
that the 50-share blocks are valued independently of each other
rather than aggregated. See Estate of Mellinger v. Commissioner,
112 T.C. 26 (1999). The parties have, as a threshold matter,
focused on the value of the 50 shares that decedent owned
outright, agreeing that the value of this 50-share block will
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Last modified: May 25, 2011