Estate Taxes

The Abe book site is a great one for buying books. But they list many copies of the same book, often at a wide range of prices. I'm not aware that you can look at what the actual sales are for those books.

On eBay, however, you can apparently see the actual results of past sales.

Stu

Then buy the stuff on eBay and get rich.

The fact that so few people are doing that implies that eBay prices aren't necessarily that low.

Seth

Except there's no evidence of actual sales. All we see are the ask side.

A dealer has had several of my books listed for a year, without sales. Does that make his asking price FMV?

Seth

I buy a lot of stuff on ebay because it is cheaper than it costs me locally. I don't resell it and "get rich" because there is an opporunity costs associated.

That statement would only be true if there were absolutely no other variables to consider. There are numerous other costs and risks associated with ebay that affect price. Shipping costs, selling fees, the inability to "try" an item before purchasing, the lack of dedicated customer service by individual sellers, and the risk of getting "scammed" all result in ebay items generally selling for less than comparable products in "brick and mortar" stores. To overcome these additional factors, ebay sellers must demand a lower price.

One can simply look for big ticket items on ebay (BMWs, plasma TVs, etc) and see that these items routinely sell for less than average prices.

Lets be realistic. Because some stranger says the price is one thing and an expert says something else, the stranger somehow trumps the expert? Common sense says that the expert wins and the courts support common sense. Find some cases that support your point or some other reference.

Drew Edmundson, CPA Cary, NC

-- Drew Edmundson, CPA Cary, NC

I don't see two people saying. I see one person saying, and one actual transaction (unless you consider eBay's reporting of prices to be the word of an unreliable stranger).

Again, the regs _define_ Fair Market Value as the price a willing buyer and seller would agree to. On the one hand, we have a willing buyer and seller, and the price they actually agreed to. On the other hand, we have an "expert" who claims they should have agreed to some other price.

Seth

One sale is not sufficient to create evidence establishing value. The expert presumably has experience with many sales and draws on them to come up with his value. But a single sale can easily be a fluke, and is unreliable for this purpose.

Stu

One can look for similar items (TVs, cameras, computers) at buy.com, amazon.com, froogle.google.com, and even woot.com and see that they routinely sell for "less than average prices". Does that mean that FMV for a book is "publisher's list" and Amazon is "wrong"?

Seth

You're limiting the definition to mean that a single transaction can consititute FMV. The IRS describes "unusual market conditions", "comparable sales", and even "expert opinion" all as factors that can render a singular transaction (or even a minority of transactions) to be an anomaly and thus not indicative of FMV.

Furthermore, immediately prior to your above definition, the IRS states "FMV is the price that property would sell for on the open market". A "market" is not defined by a single transaction but rather ALL the transactions of that good, service, or idea.

Can ebay represent FMV? Possibly. Does ebay represent FMV in this case? That depends on details not provided here. Does ebay generally represent FMV? Not in my un-official experience for reason previously stated.

I never said that FMV should be the "publishers list", nor did I say Amazon is "wrong". You're making inferences that aren't supported by my statements.

Online retailers constitute a PORTION of the market only. FMV is decided by the market, not a single or small number of transactions. If online retailers provide the bulk of the product, then FMV may, in fact, be very near online prices. If online retailers constitute only a small percentage of a product offering then FMV for that market may be no where near the online retailers price. As usual, it depends.

Originally this thread focused on the validity of ebay auctions being representative of FMV. Apparently you have now expanded the debate to include all online retailers. While ALL online retailers may cumulatively come closer to reaching average FMV (depending on the specifics) it doesn't change the original discussion.

You have now introduced a fact that is not in existence. The OP said he saw a listing, which is different than a sale. Others have already explained why even one sale is not the definition of FMV.

Just because you want something to be a certain way does not make it so. Nor does repeating the same thing over and over again make it true. A random listing on eBay will never overcome an expert's opinion.

Drew Edmundson, CPA Cary, NC

-- Drew Edmundson, CPA Cary, NC

You said that some items routinely sell for less than average on eBay, to support your claim that eBay isn't representative. (Other items routinely sell for more than average there; I've seen a book sell for $80 while it was still in print from the publisher for $35.)

Half of all sales are at less than the median price for the item, by definition.

The definition of FMV is in terms of "a buyer" and "a seller", not "the totality of the market". Yes, that means that one item will have a lot of different prices, all of which are FMV.

FMV is defined for an item, not a market.

That was in response to your claim that eBay didn't matter because its prices were often lower than "average". I pointed out that there are lots of other places with the same property.

Seth

Can the expert in this case actually point to sales of that particular item? We don't know; apparently, he didn't provide that information to OP.

Seth