T.C. Memo. 1997-176

UNITED STATES TAX COURT

BENJAMIN H. AND DIANE E. ROBSON, Petitioners v.

COMMISSIONER OF INTERNAL REVENUE, Respondent

LEROY C. AND HELEN E. TRNAVSKY, Petitioners v.

COMMISSIONER OF INTERNAL REVENUE, Respondent

Docket Nos. 23456-94, 23884-94. Filed April 10, 1997.

A. Lavar Taylor, for petitioners.

Ronald M. Rosen, for respondent.

MEMORANDUM FINDINGS OF FACT AND OPINION

FAY, Judge: Respondent determined deficiencies in

petitioners' Federal income taxes and penalties for 1990 through

1992 as follows:
- 2 -

Benjamin H. Robson

& Diane E. Robson

Docket No. 23456-94

Year

1990

1991

1992

Deficiency

$17,033

 20,629

 18,035

Penalty

Sec. 6662(a)1

$194

 205

 256

1Respondent conceded that no amounts are due for penalties.

Leroy C. Trnavsky 

& Helen E. Trnavsky

Docket No. 23884-94

Year

1990

1991

1992

Deficiency

$13,685

 11,776

 13,789

Penalty

Sec. 6662(a)1

$205

 222

 259

1Respondent conceded that no amounts are due for penalties.

All section references are to the Internal Revenue Code in

effect for the years in issue, and all Rule references are to the

Tax Court Rules of Practice and Procedure, unless otherwise

indicated.

The cases have been consolidated for trial, briefing, and

opinion. After concessions, the issues for decision are: 
- 3 -

(1) The fair market value of various wild game animal trophy

mounts donated by petitioners; and (2) whether certain appraisal

fees are deductible.

FINDINGS OF FACT

Some of the facts have been stipulated and are so found. 

The stipulation of facts and the attached exhibits are incorporated herein by this reference. Petitioners resided in Whittier,

California, at the time their petitions were filed. 

During the years at issue, Dr. Benjamin H. Robson (petitioner Robson) and Dr. Leroy C. Trnavsky (petitioner Trnavsky)

were orthodontists. Both petitioner Robson and petitioner

Trnavsky are accomplished hunters. They have been on numerous

hunting trips to locations around the world and have acquired

various animal mounts over the course of many years of hunting. 

Petitioners maintained the animal mounts in trophy rooms at their

respective homes.

Over the 3-year period from 1990 to 1992, petitioner Robson

donated 30 animal specimens, including shoulder mounts and capes

and horns, to various charitable organizations. Petitioner Robson claimed deductions for charitable contributions of $53,600,

$67,100, and $61,300 for tax years 1990, 1991, and 1992, respectively. During this same period, petitioner Trnavsky donated 24

animal specimens to various charitable organizations and claimed

deductions for charitable contributions of $39,500, $34,400, and

$41,150 for tax years 1990, 1991, and 1992, respectively.
- 4 -

At the time petitioners made their donations, under California law it was illegal to sell any mounted animal specimens

similar to petitioners' that were taken under a hunting license. 

Under Federal law, the interstate sale of any specimen sold in

violation of California law constituted a Federal offense. 

However, despite these State and Federal restrictions, game

mounts were sold in California. Further, while California has

strict prohibitions on the sale of mounted wildlife, many of the

Western States located near California, such as New Mexico,

Arizona, Montana, and Washington, have relatively few restrictions on the sale of mounted game trophies.

On their Federal income tax returns, petitioners based the

value of their contributions on appraisals performed by R. Bruce

Duncan (Mr. Duncan) of Chicago Appraisers Association (CAA). 

Petitioners Robson paid CAA $4,323.52, $3,710, and $4,166 in

1990, 1991, and 1992 and claimed deductions for these amounts

each year. Petitioners Trnavsky also claimed deductions for

appraisal fees paid to CAA of $3,891.48, $3,140, and $3,333 for

1990, 1991, and 1992, respectively. At trial, however,

Mr. Duncan was not called as a witness, and petitioners did not

rely on his appraisals at trial. Rather, petitioners now rely on

the appraisal and testimony of Jack Perry (Mr. Perry), their

expert witness at trial.

Respondent, in her notice of deficiency to petitioners

Robson, disallowed all charitable contribution deductions for
- 5 -

1990, 1991, and 1992 because she determined that petitioners

Robson had failed to demonstrate the fair market value of the

donated items. For the same reason, respondent also disallowed

all charitable contribution deductions claimed by petitioners

Trnavsky for the years at issue. Respondent concedes that

section 212 provides a deduction for reasonable appraisal fees

paid to value a charitable contribution. However, respondent

amended her answers to the petitions and now contests as

unreasonable the amount of the appraisal fees deducted by

petitioners.

OPINION

Value of Charitable Contributions

Section 170(a) provides a deduction for charitable contributions made to qualified entities during the taxable year. The

regulations provide that, if property other than money is

donated, the amount of the contribution is the fair market value

of the property at the time of the contribution. Sec. 1.170A1(c)(1), Income Tax Regs. Section 1.170A-1(c)(2), Income Tax

Regs., defines "fair market value" as the price at which property

would change hands between a willing buyer and a willing seller,

neither being under a compulsion to buy or sell, and both having

reasonable knowledge of the relevant facts. 

The determination of fair market value of donated property

is a factual inquiry. Estate of DeBie v. Commissioner, 56 T.C.
- 6 -

876, 894 (1971). Petitioners bear the burden of proof. Rule

142(a); Welch v. Helvering, 290 U.S. 111 (1933).

There is no disagreement that the donations were actually

made by petitioners. There is significant disagreement over the

value of the donated game mounts. Petitioners and respondent

presented expert testimony, and submitted expert reports,

concerning the value of these game mounts. The ultimate findings

of the respective experts are set out in the attached appendix. 

Respondent primarily relies on the testimony of Alan Zanotti

(Mr. Zanotti). Mr. Zanotti founded his company, the African

Import Company, in 1986, after he determined that there was a

large supply of game mounts within the United States available

for sale. From the inception of his company to the present day,

Mr. Zanotti has sold between 3,500 and 4,000 game items. He

indicated that there was an active market for the items involved

in this case. Additionally, Mr. Zanotti has personally purchased

or sold many items similar to those donated by petitioners. 

Mr. Zanotti believes that he would be able to assemble a collection comparable to petitioners' by purchasing items on the open

market. In fact, Mr. Zanotti currently has in his inventory many

of the same type of game mounts as those donated by petitioners. 

Respondent submitted the report of another expert,

Herbert C. Curry (Mr. Curry). Mr. Curry is a special agent with

the Fish and Wildlife Service. Mr. Curry, a hunter and a collector of animal specimens, has extensive experience in investi-
- 7 -

1Mr. Perry admitted that he was motivated to perform

appraisals by factors other than the fees he charged. In fact,

he candidly stated that his "ulterior motive" in performing

appraisals was to encourage the donation of animal specimens to

museums.

gating violations of Federal and State wildlife laws. Through

undercover work involved in his position with the Fish and

Wildlife Service, Mr. Curry has personally purchased and sold

game mounts, and he has been involved with the investigation of

other sales of wildlife. Mr. Curry asserted that, despite his

department's efforts, an illegal market in game mounts existed in

California during the years at issue. 

Mr. Curry submitted a report in which he summarized the

price range at which various game mounts were sold in California. 

Mr. Curry's report contained price ranges for those animal

specimens with which he had gained familiarity through the

performance of his duties as an agent. His price ranges in most

cases were in line with the amounts contained in Mr. Zanotti's

report.

Petitioners rely exclusively on the testimony of Mr. Perry. 

Mr. Perry is on the board of the World Wildlife Museum,1 and he

has substantial experience in the field of taxidermy. 

Mr. Perry bases his appraisals on the replacement cost

methodology. Replacement cost is the total cost the hunter

incurred in going on the hunt and related costs such as trophy

fees, taxidermy costs, and travel expenses. If more than one
- 8 -

specimen is harvested on a trip, the cost of the trip is prorated

over each specimen. Mr. Perry then adjusts the values, based

upon factors such as the quality of the specimen and its rarity. 

He believes that this is the only proper way to value animal

specimens, because he views each specimen as a unique object. 

Replacement cost is a relevant measure of value where the

property is unique, the market is limited, and there is no

evidence of comparable sales. Estate of Palmer v. Commissioner,

839 F.2d 420, 424 (8th Cir. 1988), revg. 86 T.C. 66 (1986). We

find, contrary to Mr. Perry's beliefs, that there is a market

throughout the United States for items comparable to those

donated by petitioners. 

Petitioners argue that there are no comparable sales,

because residents in California are prohibited from selling game

mounts. We reject this contention. Petitioners' argument, taken

to its logical conclusion, would result in their mounts' having

no value, as California residents could never sell them. 

Mr. Curry testified, however, that prices for game mounts in

California are equivalent to prices in States that do not place

restrictions on sales. Thus, the restrictions imposed by

California law do not materially affect the value of petitioners'

game mounts. We therefore cannot accept Mr. Perry's valuations,

as petitioners have not demonstrated that their replacement cost
- 9 -

2Estate of Miller v. Commissioner, T.C. Memo. 1991-515, 

affd. without published opinion 983 F.2d 232 (5th Cir. 1993), is

distinguishable. In Estate of Miller, the taxpayer donated

numerous animal mounts to the State of Louisiana and claimed

charitable contribution deductions. Replacement cost was

probative in the Estate of Miller case because the Court found

that no comparable items could be obtained in the market. Here,

respondent has successfully demonstrated that items comparable to

petitioners' did exist in the market. 

3The fair market value of petitioner Robson's charitable

contributions is $7,550, $12,125, and $9,425 for 1990, 1991, and

1992, respectively. The fair market value of petitioner

Trnavsky's charitable contributions is $5,750, $4,000, and $6,850

for 1990, 1991, and 1992, respectively. For a more detailed

listing of each donation, see appendix, infra.

analysis has a correlation to fair market value in this case.2

See Epping v. Commissioner, T.C. Memo. 1992-279. 

We conclude that an active market exists throughout the

United States for substantially comparable items. Petitioners

have not presented any evidence of comparable sales, relying

solely on Mr. Perry's valuations. Consequently, petitioners have

failed to carry their burden of proving that the donated game

mounts are worth more than the amount established by respondent

at trial. Thus, we conclude that, based on respondent's

appraisal, the animal specimens donated by petitioner Robson have

a fair market value of $29,100, and the specimens donated by

petitioner Trnavsky have a fair market value of $16,600.3

Deductibility of Appraisal Fees

Respondent does not dispute that appraisal fees are deductible under section 212(3) but contends that the amount of fees

paid for Mr. Duncan's services is unreasonable, and, therefore,
- 10 -

only a portion of the fees actually paid to CAA is deductible. 

Because this issue was first raised by respondent in her amended

answers to the petitions, she carries the burden of proof.

To be deductible under section 212, an expense must meet the

ordinary and necessary test. Sec. 1.212-1(d), Income Tax Regs. 

Thus, the expenses must be reasonable in amount and bear a reasonable and proximate relation to the purpose for the expenditure. Id. The determination of reasonableness is based on the

facts and circumstances. See Palo Alto Town & Country Village,

Inc. v. Commissioner, 565 F.2d 1388 (9th Cir. 1977), affg. in

part and remanding T.C. Memo. 1973-223.

Petitioner Robson claimed deductions of $4,323.52, $3,170,

and $4,166 for appraisal fees paid to CAA. Petitioner Trnavsky

deducted $3,891.48, $3,140, and $3,333 for the appraisal fees

that he paid to CAA. Respondent did not dispute that these fees

were actually paid to CAA. Nor did respondent present any

evidence to indicate that CAA charged petitioners more than it

charged other taxpayers to perform museum appraisals. Respondent

has not carried her burden to show that the fees paid were

unreasonable. Accordingly, we find for petitioners on this

issue.

Based on the foregoing,

Decision will be entered

under Rule 155.
- 11 -

APPENDIX

 Dr. Benjamin Robson 1990:

Item No. Species Type Perry Zanotti Curry

1-R Roosevelt

elk

(wapiti)

Shoulder

mount $5,500 $650 $800

2-R Barren

ground

caribou

Shoulder

mount 4,500 900 600-800

3-R Pronghorn

antelope

Shoulder

mount 3,000 550 200-600

4-R Pronghorn

antelope

Shoulder

mount 3,000 500 200-600

5-R Blesbok Shoulder

mount 5,500 700 --

6-R Tsessebe

(sassaby)

Shoulder

mount 3,750 700 --

7-R Gemsbok

(oryx)

Shoulder

mount 4,700 900 --

8-R White

tailed gnu

/black

wildebeest

Shoulder

mount 4,500 800 --

9-R Mule deer Shoulder

mount 1-0- 500 200-800

10-R Mule deer Shoulder

mount 4,000 650 200-800

11-R Mule deer Shoulder

mount 4,000 700 200-800

Total 42,450 7,550

 

1Petitioners' appraiser did not include a value for this mount in his

expert report.
- 12 -

Dr. Benjamin Robson 1991:

Item No. Species Type Perry Zanotti Curry

12-R Blacktail

deer 

Cape &

horns $3,500 $225 $200-800

13-R Blacktail

deer

Cape &

horns 3,500 250 200-800

14-R Barbary

sheep

(aoudad)

Shoulder

mount 4,500 850 400-800

15-R Steenbok Shoulder

mount 2,750 475 --

16-R Bush

duiker

Shoulder

mount 3,250 550 --

17-R Pronghorn

antelope

Shoulder

mount 3,200 475 200-600

18-R Mule deer Shoulder

mount

 3,500 650 200-800

19-R Mule deer Shoulder

mount 4,000 650 200-800

20-R Altai

argali

sheep

Full skin

& horns

27,500 8,000 200-800

Total 55,700 12,125 
- 13 -

Dr. Benjamin Robson 1992:

Item No. Species Type Perry Zanotti Curry

21-R Bighorn

sheep

Shoulder

mount $12,000 $3,000 $500-2,500

22-R Greater

kudu

Shoulder

mount 4,700 950 --

23-R Greater

kudu

Shoulder

mount 5,000 850 --

24-R Roosevelt

elk

(wapiti)

Shoulder

mount

 6,500 750 800

25-R Springbok Shoulder

mount 3,250 600 --

26-R Gray

duiker

Shoulder

mount 3,750 550 --

27-R Spanish

stag

Shoulder

mount 8,500 825 --

28-R Corsican

ram

(sheep)

Shoulder

mount

 3,000 750 --

29-R Blacktail

deer

Shoulder

mount 2,700 600 200-800

30-R Axis deer Shoulder

mount 3,200 550 --

Total 52,600 9,425
- 14 -

Dr. Leroy Trnavsky 1990:

Item No. Species Type Perry Zanotti Curry

1-T Common 

waterbuck

Shoulder

mount $4,000 $700 --

2-T Barren

ground

caribou

Shoulder

mount

 5,000 900 $600-800

3-T Defassa

waterbuck

Shoulder

mount 5,200 750 --

4-T Spanish

wild boar 

Tanned

cape 3,000 200 --

5-T Blesbok Shoulder

mount 5,500 700 --

6-T Water

Buffalo 

Shoulder

Mount 5,000 1,600 --

7-T Mountain

Goat

Shoulder

Mount 5,000 1250 1,200

8-T Mule Deer Shoulder

Mount 2,700 650 200-800

Total 35,400 5,750

1Mr. Zanotti's report indicates that this mount was damaged. 

Therefore, his valuation reflects an amount that is less than that for a

typical mountain goat mount in an undamaged condition.
- 15 -

Dr. Leroy Trnavsky 1991:

Item No. Species Type Perry Zanotti Curry

9-T Blacktail

deer

Cape &

horns $3,500 $225 $200-800

10-T Blacktail

deer

Cape &

horns 3,500 250 200-800

11-T Blacktail

deer

Shoulder

mount 2,700 600 200-800

12-T Barbary

sheep

(aoudad)

Shoulder

mount

 4,500 850 400-800

13-T Steenbok Shoulder

mount 2,750 475 --

14-T Kirk's

dik-dik

Shoulder

mount 3,700 475 --

15-T Pronghorn

antelope

Shoulder

mount 3,000 475 200-600

16-T Mule deer Shoulder

mount 3,500 650 200-800

Total 27,150 4,000
- 16 -

Dr. Leroy Trnavsky 1992:

Item No. Species Type Perry Zanotti Curry

 17-R Pronghorn

antelope

Shoulder

mount $3,000 $500 $200-600

18-R Roosevelt

elk

(wapiti)

Shoulder

mount

 6,500 750 800

19-R Cape

buffalo

Shoulder

mount 5,000 1,200 --

20-R Bison Shoulder

mount 3,000 1,600 1,200

21-R Coues deer Shoulder

mount 3,500 600 300-600

22-R Coues Deer Shoulder

Mount 3,500 600 300-600

23-R Whitetail

deer

Shoulder

mount 2,700 900 --

24-R Red lechwe Shoulder

mount 3,200 700 --

Total 30,400 6,850