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The estate timely petitioned the Court and challenged each
adjustment respondent made. The estate claims that the value of
DP is overstated on the estate tax return. The estate contends
that the value of DP was $4,238,000 on the valuation date, which
is $140,013 less than it reported on the estate tax return.
The estate has since conceded the $157,500 increase to the
fair market value of decedent’s residence. The parties also
agree that the estate may deduct 5 percent of the value of the
probate assets located in South Carolina as executor’s
commissions, New York executor’s commissions of $23,832, and
$277,750 for attorney’s fees. These deductions require payment
of the corresponding amounts.
OPINION
Section 2001 imposes a Federal tax “on the transfer of the
taxable estate of every decedent who is a citizen or resident of
the United States.” The value of a decedent’s gross estate
includes the fair market value of any interest the decedent held
in property. See secs. 2031(a), 2033; United States v.
Cartwright, 411 U.S. 546, 551 (1973); sec. 20.2031-1(b), Estate
Tax Regs. Fair market value reflects 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 to sell and
both having reasonable knowledge of relevant facts.” Sec.
20.2031-1(b), Estate Tax Regs.; United States v. Cartwright,
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