- 60 -
which it was represented that the foundation would pay $110
million and the transferring physicians would "make charitable
donations in an aggregate amount, and deduct from their income
taxes proportionate amounts of that aggregate, which, when
combined with the [$110 million] cash purchase price, will not
total more than $125 million." However, the issue addressed in
the determination letter was the tax-exempt status of the
acquiring foundation (which was granted). The determination
letter thus had no occasion to consider the issue of donative
intent (much less rule on deductibility), observing only that
"Donors may deduct contributions to you as provided in section 170
of the Code." Respondent also argues, and we agree, that there
are significant distinctions between the facts as represented in
the Friendly Hills determination letter and petitioners'
circumstances. In the Friendly Hills transaction, unlike the
cases at issue, the transferring physicians had executed
noncompete agreements, there were no signing bonuses (i.e.,
"Physician Access Bonuses"), and the donations represented
approximately 12 percent of the transfer ($15 million/$125
million), whereas petitioners claim that approximately 61.5
percent of the "business enterprise value" of SWMG was given away
($2,515,255 intangibles/$4,088,450 "business enterprise value"37).
37 The figures above are taken from the Dutcher appraisal's
estimate of the intangible assets purportedly contributed by the
SWMG physicians, on which petitioners currently rely. On the
(continued...)
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