@TaxTime13 wrote:
Thank you! This is what I was hoping.
Quick question about the fair market value. Is this the fair market value stated on the annual property tax bill?
Someone else recommended to hire an appraiser to get something that I could reference for the basis, however, that would most definitely be higher than what is stated by the county. Also, there is the cost of hiring an appraiser. Do you see any need for this?
Thanks again for your thoughts.
You should hire an appraiser, it will be worth the tax savings to properly document the basis. Property tax bills are very unreliable as indicators of fair market value for many reasons, and if you are audited, the auditor will know this. Under the law, the IRS does not have to accept any basis that you can't prove with reliable records. If the auditor thinks your property tax bill is not the fair market value, the auditor can assign any lower basis they believe is reasonable, and then you would have to appeal to the Tax Court, at which point you will need the appraisal anyway.
