Opinion ID: 484696
Heading Depth: 2
Heading Rank: 2

Heading: Time of Valuation

Text: 30 The fair market value of property as of a given date is a question of fact for the tax court to resolve considering all relevant evidence in the record. Skripak v. Commissioner, 84 T.C. 285, 320 (1985); Kaplan v. Commissioner, 43 T.C. 663, 665 (1965). The tax court's finding on fair market value must stand unless it is clearly erroneous. Tripp v. Commissioner, 337 F.2d 432, 434 (7th Cir.1964). 31 The tax court had before it only the parties' stipulations and two appraisals. The court is not required to accept an appraiser's opinion if it is contrary to the court's own judgment on value. Chiu v. Commissioner, 84 T.C. 722, 734 (1985). The court found insufficient evidence of the lithographs' value as of the date of donation; the court, therefore, calculated the value of the taxpayers' deduction based on the price the taxpayers paid for the lithographs. Taxpayers argue that the cost of the lithographs does not accurately represent their fair market value fifteen months later, when the taxpayers donated them. The only evidence of the lithographs' value at the time of donation was the parties' stipulation that some consumer(s) paid $300 to buy lithographs from some gallery(ies). The taxpayers provided no evidence of the number of such sales, what types of customers were involved, or any other specific information. As the court noted, [i]t is common knowledge that a consumer can pay a wide range of retail prices for the same item depending on where he chooses to shop and how much investigating he does of the various sources of a particular item. 85 T.C. at 69 (1985). The tax court, finding the stipulation to be too vague to be reliable as to the lithographs' value, instead relied on the record evidence that 63% of the Nierman lithographs sold in the United States in 1978 and 1979 were sold for $100. 32 The tax court in Chiu similarly relied on prices actually paid for the property rather than expert testimony which the court found to be unpersuasive. 84 T.C. at 734. And in Skripak, the court rejected expert opinion on value because the expert relied on an improper market in determining the value of the property at issue and failed to take into account the bulk of the sales. 84 T.C. at 322. Viewing the evidence in the record in the light most favorable to the market value finding, Tripp v. Commissioner, 337 F.2d at 435, we hold that the tax court was correct in its decision to rely on the price taxpayers paid for the lithographs rather than the vague stipulation that some people paid three times that amount. Nothing in the record indicates that the taxpayers received any kind of discount that was not generally available to other buyers. There was only a brief interval (15 months) between the time the taxpayers bought the lithographs and the time they donated them, and there is no evidence in the record of any significant appreciation in the lithographs' value during this interval. The tax court could reasonably have found that the lithographs' purchase price accurately reflected their value at the time the taxpayers donated them. 33 This was an interesting tax-saving arrangement devised as an art transaction, but the art will have to be treasured for art's sake and not as a tax deduction. Taxpayers' complaint was against the Commissioner, whereas perhaps it should have been against those who sold them the art if they are now dissatisfied with it as art or as a tax deduction. 34 Because the tax court's decision on the amount that taxpayers were entitled to deduct for their charitable contribution is not clearly erroneous, we affirm. 35 AFFIRMED.