Acceptable FMV Documentation
Acceptable documentation depends on the type of asset held in the account, but commonly includes:
- Account or investment statements showing year end value
- Appraisal reports prepared by a qualified professional
- Broker opinion letters or comparable sales reports
- Sponsor or fund statements confirming valuation
- Written valuation letters from note servicers or managers
- Exchange or market price documentation for publicly quoted assets
Documentation should reflect the value as of December 31 and clearly identify the asset being valued.
What Information Must Be Included
Regardless of format, FMV documentation should include:
- The name or description of the asset
- The valuation date
- The stated Fair Market Value
- The source of the valuation
- Any relevant account or ownership details
If the documentation references multiple investors or accounts, it should clearly show the portion attributable to your IRA.
What Is Not Sufficient
Certain materials are commonly submitted but do not provide enough support on their own.
Examples of insufficient documentation include:
- Purchase contracts without updated valuation information
- Screenshots without dates or source context
- Estimates without written support
- Informal emails without asset or valuation details
- Internal notes or assumptions without third party confirmation
If documentation does not clearly explain how the value was determined, it may result in follow up requests.
Why Clear Documentation Matters
Complete documentation allows the custodian to report FMV accurately and consistently. It also creates a clean record that supports future reporting, distributions, and planning.
Providing documentation that is clear and thorough the first time helps avoid delays, corrections, and unnecessary back and forth.
A Simple Rule of Thumb
If someone unfamiliar with the investment can review the documentation and understand how the value was determined, it is likely sufficient.