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of value.”(citing Elmhurst Cemetery Co. v. Commissioner, 300 U.S.
37, 39 (1937), and Rubber Research, Inc. v. Commissioner, supra
at 1406))), affg. T.C. Memo. 1974-285; accord Estate of Scanlan
v. Commissioner, T.C. Memo. 1996-331. To be sure, petitioners
even advocate that an actual sale is the best indicium of that
fair market value. They state in brief that expert testimony
need not be considered upon the finding of a contemporaneous,
arm’s-length sale; such a sale of property, they state, is
“indicative of its fair market value as a matter of law”.
When a subsequent event such as the third sale before us is
used to set the fair market value of property as of an earlier
date, adjustments should be made to the sale price to account for
the passage of time as well as to reflect any change in the
setting from the date of valuation to the date of the sale. See
Estate of Scanlan v. Commissioner, supra. These adjustments are
necessary to reflect happenings between the two dates which would
affect the later sale price vis-a-vis a hypothetical sale on the
earlier date of valuation. These happenings include:
(1) Inflation, (2) changes in the relevant industry and the
expectations for that industry, (3) changes in business component
results, (4) changes in technology, macroeconomics, or tax law,
and (5) the occurrence or nonoccurrence of any event which a
hypothetical reasonable buyer or a hypothetical reasonable seller
would conclude would affect the selling price of the property
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