Annual Asset Valuations
March 20, 2018
According to the reporting requirements outlined in IRC section 408(i) and other IRS guidelines, Quest Trust Company, Inc. (“Quest”) is required to collect supporting documentation for all fair market valuation (“FMV”) submissions. Where assets are illiquid or their value is not readily ascertainable on either an established exchange or generally recognized market, client must provide the year end value for each asset and include the proper supporting documentation to substantiate the assessed value. The type of supporting documentation may vary depending on the underlying asset.
This Memorandum specifically outlines the procedural requirements Quest has implemented to comply with IRS guidelines.
CHANGES IN POLICY
Effective immediately, Quest is requiring all clients with any illiquid assets in his or her account to include the appropriate supporting documentation for any FMV submissions. Depending on the asset you hold in your account, the following is a list of acceptable examples of supporting documentation for each respective asset:
1. Real Estate – Appraisal, Broker’s Price Opinion (BPO), County Appraisal Value
2. Note – If amortized, attach amortization schedule.
3. Private Entity – A letter from a managing member on letterhead stating the value or a balance sheet reflecting the value of the partner’s value.
4. Personal Property – Third party valuation from a qualified professional.
If you have any questions concerning this policy change, please feel free to contact our office directly at 800-320-5950.
Quest Trust Company, Inc.