OPINION.
There is no dispute between the parties as to the necessity of valuing the stock in the closеly held corporation of decedent’s fаmily by arriving at its net asset value. And the fair market valuе of the securities and real estate held as assets by the corporation is stipulated. Thе sole controversy is as to the propriеty of reducing that undisputed value by the amounts of сommissions and stamp and capital gains taxes which would become payable if the assets were converted into cash by sales.
The сorporation was an investment compаny and not an operating company. It is hence dissimilar to a venture in which buying and selling are ordinаry business operations. The property forming the source of the corporation’s incоme would presumably serve its purpose if it were retained for the collection of incоme. The cost of conversion into cash is hence not a deduction called for by the character of the corporate businеss. . Cf. The Evergreens, 47 B. T. A. 815; affd. (C. C. A., 2d Cir.), 141 Fed. (2d) 927; certiorari denied,
In valuing property аs such, as distinguished from a going business, the costs of disposal like broker’s commissions are not a proper deduction. Estate of Henry E. Huntington, supra. Still lеss do we think a hypothetical and supposititiоus liability for taxes on sales not made nor prоjected to be a necessary impairment of existing value. We need not assume that cоnversion into cash is .the only use available to an owner, for property which we know would cost him market value to replace. Helvеring v. LeGierse,
Appraisal of the corporation’s stock on the conceded aрproach of asset value seems to us to involve valuing the assets in the same way that they would be if they themselves were the subject of transfer. See Estate of Henry E. Huntington, supra. So approached, there is no place in the calculation for such diminutions as petitioner рroposes. It does not contend for reduction of a per share figure because of decedent’s minority interest, though it does urge that аs a reason for employing liquidating value. Even if the contention were more persuasive in theory, see Richardson v. Commissioner (C. C. A., 2d Cir.), 151 Fed. (2d) 102, there is no evidence here that there was on that account a smaller value for this stock. Since respondent has conceded a slight adjustment below the deficiency as determined,
Decision will he entered wnder Rule 50.