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amounts should be distributed. The preponderance of the evidence
therefore establishes that the full value of the transferred
assets is includable under section 2036(a).
Pursuant to section 2036(a), 99 percent of the net asset
value of SFLP and 47 percent of the value of assets held by
Stranco should be included in decedent’s gross estate.
Nonetheless, because respondent never asserted an increased
deficiency in connection with the section 2036 issue, valuation
of the property in dispute, i.e., interests in SFLP and Stranco,
will be limited by the amounts determined in the notice of
deficiency. The decision to be entered, however, will take into
account any additional deductions to which the estate is entitled
for costs and expenses incurred subsequent to the initial trial
of this case.
To reflect the foregoing,
Decision will be entered
under Rule 155.
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