how do you determine fair market values? for noncash charitable contributions?

Question

tax returns. so do you know?
best answer for the best answer ...apparently. and if you give a certified website, then it's a def that you're going to get it. ... . .only if you care

Answer 1

Legal definition of "fair market value":

The amount that a reasonable buyer and a reasonable seller agree upon for a product or service.

Fair market value is a moving target, and the most authoritative source for ALL tax consequences is the open market. For example, the fmv of a house is the sale price, not the tax assessment and not the real estate agent's guess.

The best way to know the value of the "stuff" you give is to go into the store and see what they sell for. The amounts should be similar.

Charitable contributions are all over the map, but they're usually very generously embellished for tax returns. I don't think the IRS really cares to check up on the veracity of that receipt you get from turning in a bag of clothing, but they will investigate bigger items.

Receipts serve as proof of contribution and serve as the fair value.

Congress has created other means of limiting this benefit. People have limits on the deduction depending on what they give (cash or property) and who they give it to (charity, foundation or private person). Corporations have a specific function within their tax formula for handling company contributions, and it's even more restrictive.

You could say that the bigger eBay gets, the more the web site can act as an authority on the fair market value of anything you want to know.

Answer 2

Voodoo works. You have to determine what the item would sell for as is in today's market. You can go to kbb.com for cars. I have noticed that clothing sold at thrift stores generally runs about 15% of what a similar item sells for new. That would not include underward & socks (Yuck.) Most household goods are worth garage sale values, which is to say, almost nothing.

Answer 3

It depends on what you are donating. If you donate a car, the organization you donate it to will give you a form saying what they sold it for, and that's what your deduction can be. If you donate to goodwill or salvation army, get a receipt for the items - their websites have lists of fair market values for items. If you are donating something like expensive artwork or jewelry, you'll want to get an appraisal from an appraiser that speciallizes in that type of item.

Answer 4

It's an estimate. The majority of people under estimate the FMV. Assume you donate a pair of pants that cost you $50. And they are in fair condition. Throw a value of $40 to it.

For small items its not too big of a deal. If it's a car, use the blue book value and any value for upgrades.

Answer 5

What would YOU be willing to pay for it if you were buying it from a stranger?

That would be your best guess.

If you consult kbb.com or ebay, look for CLOSED sales, not what people are dreaming that others are willing to pay.