Last week the IRS voluntarily dismissed its appeal of Wandry v. Commissioner, according to the Tax Court’s case docket.

As BV appraisers and estate and gift advisors will recall, the original March 2012 decision in Wandry was a solid win for the taxpayer in upholding a defined-value clause against arguments by the IRS on legal as well as public policy grounds. The Tax Court issued its ruling as a memorandum opinion, however, which doesn’t bind the court or parties to similar disputes in the future. When the government subsequently filed its notice of appeal to the 10th Circuit, many experts hoped a “final” decision would result in authoritative precedent—for or against formula-value clauses—in at least one federal jurisdiction.

The IRS doesn’t indicate any reason for its voluntary dismissal. This means that the validity of formula-value clauses is still one of those issues in the estate and gift tax arena—like the treatment of pass-through entities and discounts for lack of marketability—that remains largely unsettled.