Fair Market Value

If your accounts are held with Advanta IRA, you will receive this form from us. If your accounts are with another administrator, you should receive a form from them. The plan owner is responsible for ensuring all information on the form is current and correct.

If the person or entity completing the valuation charges for the service, your IRA must pay the cost of the valuation. This is considered an expense relevant to the account. You are not allowed to pay for the FMV with your personal funds.

While you are responsible for having valuations completed on the assets in your plan, your account administrator submits this information to the IRS for you. Advanta IRA submits FMVs on behalf of our clients using Form 5498.

You may be able to provide a fair market value yourself. But some assets require an independent, neutral person or entity to do so—someone who has no disqualifying relationship with you or your retirement plan. Consult a professional to determine what valuations you can make yourself and what valuations must be performed by a third party.

Depending on what assets your IRA holds, an attorney, CPA, or a financial planner could complete FMVs of your assets. If your investments are in real estate, a certified property appraiser, the county tax assessor, or other licensed real estate professional would suffice.

Yes. You must have FMVs done for each asset in your plan. For example, if your IRA owns two rental properties, you must provide an FMV for each property.

This is a document your plan administrator submits to the IRS to report the FMV of your assets, including the following information:

• Recharacterization amounts of any funds (contributions and/or earnings) transferred from one IRA to another
• Roth IRA conversions of funds from traditional, SEP, or SIMPLE IRAs into Roth accounts
• Rollovers of funds into a traditional or Roth IRA; including qualified rollover contributions to a Roth account
• Contributions to your account (certain eligibility requirements apply depending on the type of your account, employee vs. employer contributions, contribution deadlines for your account, etc.)

Required minimum distributions (RMDs) are stated for the upcoming year (if you are eligible to take yearly RMDs).

Requirements may vary for different retirement plan administrators. Below is Advanta IRA’s process for our clients:

Advanta IRA requires FMVs be submitted to us no later than March 15. This allows us to perform accurate and timely reporting to the IRS by the proper filing deadlines (which can vary depending on your account structure and type). The following process can be used as a guideline for compiling information relevant to FMVs to submit to your administrator:

• One form is required for each asset in your plan(s), assigning the value of each asset as of December 31st of the reporting year.
• Each form must be signed by you AND the qualified person who performed valuation of your asset(s).
• Any supporting documents (i.e., property appraisals, balance sheets, etc.) should be submitted with the FMV.
• FMVs are reported on IRS Form 5498.

Advanta IRA clients can download our FMV form and to complete and send to us.