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The value of the properties that were transferred to the
partnership is includable in decedent’s gross estate under
section 2036(a). The properties are included in the estate at
the fair market value on the date of decedent’s death, subject to
the effect of the BLA.
Valuation of the Properties
The parties have stipulated the undiscounted values of all
seven properties in which decedent had an interest. Three of the
properties, Manzanita, Crescent Bay, and Railroad, are not
subject to the BLA. The three properties will therefore be
included in the value of the estate at stipulated values of
$2,261, $265,176, and $115,711, respectively.
Property is included in the gross estate at its fair market
value, which is “the price at which the property would change
hands between a willing buyer and a willing seller, neither being
under any compulsion to buy or sell and both having reasonable
knowledge of relevant facts.” Sec. 20.2031-1(b), Estate Tax
Regs.; Estate of Newhouse v. Commissioner, 94 T.C. 193, 217
(1990). The determination of fair market value is a question of
fact. Estate of Newhouse v. Commissioner, supra at 217. During
trial, we received reports and testimony from expert witnesses.
We evaluate the opinions of the experts based on the
qualifications and reasoning of each expert and on all other
credible evidence in the record. See Estate of Jones v.
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