Cotton

Here for review are decisions of the Tax Court that there were deficiencies in respect of taxes on gifts made by petitioners (Victoria L. Cotton and Virginia Caldwell) in 1941. Petitioner Cotton made a gift of 200 shares of stock of 'Carson Estate Company, hereafter called Carson, valued it at $250 a share and paid a gift tax computed on that basis. Petitioner Caldwell made a gift of 105 shares of stock of Francis Land Company, hereafter called Francis, and 100 shares of stock of Dominguez Estate Company, hereafter called Dominguez, valued the Francis stock at $374 a share and the Dominguez stock at $340 a share and paid a gift tax computed on that basis. The Tax Court found that, at the time of the Cotton gift, the Carson stock had a fair market value of $500 a share, and that, at the time of the Caldwell gift, the Francis stock had a fair market value of $990 a share and the Dominguez stock a fair market value of $900 a share. These findings are specified as error.

Respecting the valuation of property for gift tax purposes, the applicable regulation (§ 86.19 of Treasury Regulations 108) provides: “The value of the property is the price at which such property would change hands…