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Of course, the assignees’ determination of the fair market
value of the gifted interest, while binding among themselves for
purposes of determining their respective assignee interests, has
no bearing on our determination of the Federal gift tax value of
the assignee interests so allocated. Since we find that the fair
market value of a 1-percent assignee interest in MIL on the
valuation date was $120,046, the following table expresses the
fair market values of the percentage assignee interests passing
to the various assignees:
Percentage Fair Market
Assignee Assignee Interest Value
Children and trusts 77.21280956 $9,269,089
Symphony 1.49712307 179,724
CFT 3.62376573 435,019
9,883,832
C. Conclusion
We find that the fair market value of the property right
transferred by petitioners to CFT was $435,019.47 Taking into
47 The rule is well established that we may approve a
deficiency on the basis of reasons other than those relied on by
the Commissioner. See Wilkes-Barre Carriage Co. v. Commissioner,
39 T.C. 839, 845 (1963) (and cases cited therein), affd. 332 F.2d
421 (2d Cir. 1964). Because our conclusion that the valuation
clause of the assignment agreement does not achieve the claimed
“tax neutralization” effect is based on the language of the
assignment agreement, we need not address respondent’s arguments
that (1) the formula clause is against public policy, and (2) the
transaction should be recast as transfers of cash by petitioners
to CFT and the symphony under an integrated transaction theory.
We note that the application of respondent’s integrated
transaction theory would result in an initial increase in the
amount of petitioners’ aggregate taxable gift of only $90,011
(less than 1 percent), which would be partially offset by the
resulting increase in the gift tax liability that the
noncharitable donees assumed under the assignment agreement.
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