- 5 -
successful product lines that were sold under legally protected
trade names.
During the period 1981 through mid-November 1995, Godfrey
experienced a consistent growth in net sales at a compounded rate
that approached 18 percent. From 1991 through September 15,
1997, Godfrey experienced consistent growth in its profitability.
On the basis of earlier planning, a 100,000-square-foot expansion
of Godfrey’s Elkhart facility was commenced during 1998. For its
year ended December 31, 1996, Godfrey earned almost $2.5 million
in net income from approximately $61 million in sales. For the
years 1993 through 1997, Godfrey did not pay dividends to its
shareholders. Although Godfrey’s sales of pontoon boats
increased by a few percentage points from 1996 to 1997,
nationwide sales of pontoon boats decreased by 5 percent.
On June 17, 1998, the estate filed a Form 706, United States
Estate (and Generation-Skipping Transfer) Tax Return, in which
the 187.5 Godfrey shares were reported as having a discounted
fair market value of $2,246,500. The value reported was based on
an appraisal prepared by Michael A. Dorman, which was attached to
the Form 706. Respondent issued a May 8, 2001, notice of estate
tax deficiency determining that the fair market value of
decedent’s interest in Deputy FLP was $4,835,300, as opposed to
the $2,589,000 reported by the estate. On June 2, 2001, the
estate filed an amended Form 706, in which the 187.5 Godfrey
Page: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
Last modified: May 25, 2011