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investor who, inherently, is unable to cause liquidation.10 In
addition, the record reveals that there was no intention of the
trusts or the Jelke family shareholders to liquidate. A
hypothetical buyer of a 6.44-percent interest in CCC is in effect
investing in the potential for future earnings from marketable
securities. A hypothetical seller of CCC shares likewise would
not accept a price that was reduced for possible tax on all
built-in capital gain knowing that CCC sells or turns over only a
small percentage of its portfolio annually. In that regard, the
record reflects that CCC had a long-term history of dividends and
appreciation, with no indication or business plan reflecting an
intention to liquidate. In addition, as of the 1999 valuation
date, one of the trusts holding CCC shares was designed so as not
to terminate before 2019, and none of the CCC shareholders had
sold or planned to sell their interests. These factors belie the
use of an assumption of complete liquidation on the valuation
date or within a foreseeable period after the valuation date.
The estate contends that its approach and assumption of
complete liquidation is supported by the holding in Estate of
Dunn v. Commissioner, 301 F.3d 339 (5th Cir. 2002). In
particular, the estate argues that the holding of the Court of
Appeals for the Fifth Circuit requires that an asset-based
10 Even if we were considering the value of a majority
interest in CCC, a hypothetical buyer would not purchase the
shares and then sell the stock to realize the net asset value,
less the built-in capital gain tax liability. All of the
securities held by CCC could have been acquired on the open
market without built-in capital gains.
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