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However, we did find some weakness in his approach; i.e., the
fact that he chose guideline companies that, even in his own
opinion, were not similar to Harlee.
In arguing for a lower value of Harlee, the estate
continually attempted to shift our focus to the rate of return
expected by a hypothetical buyer of Harlee. However, we cannot,
overlook the fact that a hypothetical seller would not sell
Harlee valued as a going concern if a substantially larger amount
could be realized by means of Harlee’s liquidation. Further,
Harlee had an established record of past earnings which belies
the estate’s position.
We hold that the includable value of Harlee on October 23,
1995, was $2,091,750, the value reported on the Estate of Natalie
Leichter’s estate tax return.
To reflect the foregoing,
Decision will be entered
under Rule 155.
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