CCA 200927035: Ascertainable value generally fixes the amount realized at the sale date

Plain-English summary

Chief Counsel offered a preliminary response to a fair-market-value question and expressly stated that no research had been done on the specific issue. The email points to authorities limiting the open-transaction doctrine to unusual circumstances and mentions the Ninth Circuit’s Warren Jones case. It states the general rule that the amount realized is determined on the sale date when the asset received has an ascertainable fair market value. The release does not include the underlying question or transaction facts.

Ruling snapshot

• Question: When is the amount realized determined if the property received has an ascertainable fair market value?
• Outcome: Advice given: generally at the date of sale
• Key authorities: IRC § 1001 (indexed issue); Warren Jones (Ninth Circuit case named without a reporter citation)

Full text (IRS public release)

ID: CCA_2009051115524542 Number: 200927035
Office: ----------------------------
Release Date: 7/2/2009

UILC: 1001.00-00

From: ----------------------
Sent: Monday, May 11, 2009 3:52:53 PM
To: --------------------
Cc:
Subject: RE: FMV issue

It's not often that I get thanked for doing nothing. It is much more common to work and not receive thanks.

I have not done any research in response to your specific question. I would however refer you to the authorities suggesting the "open transaction" doctrine is no longer considered valid except in unusual circumstances. A Ninth Circuit case by the name of Warren Jones comes to mind. The general rule is that you determine the amount realized on the date of sale so long as the asset you receive has an "ascertainable fair market value."

Thanks.