H&J CPA

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What is Fair Market Value

Fair market value is the standard of value to be used in all tax related cases. 

The focus of fair market value is on a hypothetical transaction between a hypothetical buyer and a hypothetical seller as of the date of valuation. 

Due to the hypothetical nature of the parties, it does not consider the unique synergistic or strategic elements that may exist in an actual transaction between a particular buyer and a particular seller. 

Fair market value has been misinterpreted in numerous valuations and cases in the tax realm. It is extremely important that it be interpreted properly in order to have a tax related valuation hold up under audit or at trial.

Call one of our credentialed professionals to assist you in better understanding the impact of “fair market value” on value for the case at hand or any other valuation or litigation needs.