Estate of George C. Blount, Deceased, Fred B. Aftergut, Executor - Page 25

                                       - 25 -                                         
               To this amount, Mr. Hitchner added $3,046,823 of insurance             
          proceeds on decedent’s life13 to yield a value of approximately             
          $10 million for 100 percent of BCC’s shares.  Multiplying this              
          amount by decedent’s 83.2-percent interest in BCC resulted in a             
          corresponding value of $8,360,000 (rounded) for decedent’s 43,080           
          BCC shares, as of the valuation date.  Like Mr. Fodor, Mr.                  
          Hitchner did not apply any discounts or premiums in valuing                 
          decedent’s block of shares.                                                 
          I.  Effectiveness of the Buy-Sell Agreement                                 
               Federal estate tax is imposed on the transfer of a U.S.                
          citizen’s taxable estate.  Sec. 2001(a); U.S. Trust Co. v.                  
          Helvering, 307 U.S. 57, 60 (1939).  The taxable estate is defined           
          as the gross estate less prescribed deductions.  See sec. 2051.             
          The gross estate includes all property interests owned by the               
          decedent at death; the value of the gross estate is generally the           
          fair market value of the included property as of the valuation              
          date, which is generally the date of death.  See secs. 2031(a),             
          2033; sec. 20.2031-1(b), Estate Tax Regs.                                   

               13 Although described as the life insurance proceeds on                
          decedent’s life, the figure Mr. Hitchner actually used was that             
          for the proceeds from the policy on Mr. Jennings’s life.  The               
          insurance proceeds received on decedent’s life were $3,146,134.             

Page:  Previous  15  16  17  18  19  20  21  22  23  24  25  26  27  28  29  30  31  32  33  34  Next

Last modified: May 25, 2011