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In the case herein, respondent’s notice of deficiency
increased the value of decedent’s interest in the Turner
Partnership from $875,811, as reported on the return, to
$1,717,977, and increased the value of decedent’s interest in the
Thompson Partnership from $837,691, as reported on the return, to
$1,396,152. Respondent explained the changes to the value of his
partnership interests as follows: “The 20% minority discount and
20% lack of marketability discount has been disallowed on each of
the above limited partnerships.” In addition, respondent decreased
the value of decedent’s Turner Corp. stock from $5,190, as reported
on the return, to $4,094, and increased the value of his Thompson
Corp. stock from $7,888, as reported on the return, to $13,977.
In an amendment to the answer, respondent asserted that the
limited partnerships and the two family corporations should be
disregarded for Federal estate tax purposes and that the property
includable in decedent’s gross estate is his share of the
underlying assets owned by the partnerships as of the date of his
death. In the alternative, respondent asserted in the amendment to
the answer that with respect to the assets transferred by decedent
to the partnerships, decedent retained control and enjoyment
sufficient to include the date-of-death value of those assets in
the gross estate pursuant to section 2036(a).
The adjustments made by respondent in the notice of deficiency
resulted from respondent’s disallowance of any discounts for
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