Welcome Guest. Register Now!  



Reply
 
LinkBack Thread Tools Search this Thread Display Modes
  #1 (permalink)  
Old 04-26-2008, 02:39 PM
Junior Member
 
Join Date: Jan 2007
Posts: 19
What is meant by Fair Market Value with respect to Donations?

Can you please tell me what is meant by the term Fair Market Value with reference to making a Charitable Contribution? Thanks!



Digg this Post!Add Post to del.icio.usBookmark Post in TechnoratiFurl this Post!Reddit! stumble!bookmark in google!Share on Facebook!
Reply With Quote
  #2 (permalink)  
Old 05-05-2008, 11:35 PM
TaxGuru's Avatar
Tax Guru
 
Join Date: Jan 2007
Location: New Jersey, USA
Posts: 2,417
Blog Entries: 3
What is meant by Fair Market Value with respect to Donations?

Fair market value (FMV) can be defined as being the "price that a property would sell for on the open market."

Generally speaking, it is the price that would be agreed on between a willing buyer and a willing seller both parties, without restrictions and with both parties having reasonable knowledge of the relevant facts.

With respect to donated property, such as making a donation of used articles of clothing to a charitable organization, the IRS has specifically stated that the FMV would be determined by the price that buyers would pay for these used articles of clothing with consideration given to the age and condition of these items.

Several factors are suggested by the IRS that should also be taken into consideration when arriving at FMV of the articles or items that are donated such as the following:
  1. The cost or selling price of the item,
  2. Sales of comparable properties,
  3. Replacement cost, and
  4. Opinions of experts.

__________________
Find a CPA near you!

Ask TaxGuru Please refer to the legal disclaimer.


Digg this Post!Add Post to del.icio.usBookmark Post in TechnoratiFurl this Post!Reddit! stumble!bookmark in google!Share on Facebook!
Reply With Quote
Ads
Reply



Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

vB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
What are the IRS rules regarding 2007 donations of cars exceeding $500 in value? BebopVT Itemized Deductions 1 02-29-2008 03:35 PM
What are the rules for Non-Cash Donations not involving vehicles? Cooper Miscellaneous 1 02-29-2008 01:13 AM

Follow us on Facebook Follow us on Twitter Google Buzz Rss Feeds

» Categories
 
Individual
 » Income
 » IRA/Sep
 » Medical
 
Corporations
 » Payroll
 
Forum for CPAs
 
Financial Planning
 
 
 

» Recent Tax Q&A
No Threads to Display.