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Fair Market Valuations

The IRS requires an accurate annual Market Valuation for the assets held in your self-directed retirement account. 

What to Know About Fair Market Valuations (FMV) 

How do I submit my FMV information? 

  • On the Overview page, find the appropriate asset and click on Valuate in the righthand column. 
  • If this is a real estate holding, you will need to click Take Action and then Valuate. 
  • Provide any requested information and upload your supporting documentation. 
  • Agree to the Terms & Conditions and click Submit. Done! 

If we have questions, or if your FMV is incomplete, we will send you a notification using our Portal Messaging system.  If you have a message, an email will be sent to the email address on file letting you know you have a new message.  Once your valuation is accepted and processed, the new value will be visible on your overview page. 

Do I need an FMV? 

As most assets held at NDTCO do not have values that can be automatically updated, an FMV is needed annually. The assets which require an FMV include: 

  • Real Estate 
  • Private Equity 
  • Closely Held LLC 
  • Private Notes 
  • Alternative Assets not listed 

Public equity, and precious metals do not require an FMV as they have a clear and easy-to-determine value.  

Where can I get qualified valuations? 

Examples of valid documentation: 

  • Real Estate: 
    • Appraisal by a Licensed Appraiser
    • Official Broker Price Opinion by a Licensed Real Estate Professional 
    • Comparative Market Analysis (Must be prepared by a licensed Real Estate professional)* 
    • County Tax Assessment 
      • Private Equity: 
        • Statement of Value Signed by an Authorized Officer of Company 
        • Stock Valuation Letter 
        • Annual Shareholder Statement 
            • Private Loans: 
              • Amortization Schedule 
              • Valuation from CPA or Attorney 
              • Valuation from Loan Servicer 
                  • Closely Held LLC: 
                    • Supporting documents for any of the aforementioned assets held by the LLC 
                    •  Statements for all bank accounts held by the LLC 
                    • Statements for all brokerage accounts held by the LLC 
                    • Depository holdings report for any precious metals owned by the LLC 

                          Examples of Qualified Third Parties for Assessment: 

                          • Managing Partner or Member 
                          • Company Executive or Authorized Officer 
                          • Government or County  
                          • Certified Real Estate Broker 
                          • CPA or Attorney 
                          • Certified Appraiser 
                          • Independent Valuation Company 

                          Note:

                          • We do not accept valuations from Real Estate websites such as Redfin, Zillow, or Trulia. 
                          • Assessments and documentation must be provided by a non-disqualified individual/entity

                          When do I need to submit my FMV? 

                          • To have the asset value updated on Form 5498, all FMVs need to be received by January 15. 
                          • An account value statement (i.e., Form 5498) is sent in May annually and reflects the account value as of the end of the prior year. 
                          • Any FMVs still in progress or sent in after January 15th, will not be listed on Form 5498 until the following year. 
                          • Fair market valuations are valid for a full year and can be updated at any point throughout the year. 

                          What do I need to know when gathering my information? 

                          • You will need supporting documentation showing the value for each asset held in your account. The value provided needs to match the FMV form submitted. 
                          • You do not have to supply a valuation for any assets bought or funded within the last 12 months.   
                          • NDTCO no longer requires a valuator’s (or third party) signature on the FMV form. 
                          • K-1s cannot be used for fair market valuation as they provide historical data.     
                          • If you have a Closely Held LLC, you will need to provide a value, with supporting documents, for each asset held by the LLC. A statement with the cash balance held in the LLC must also be included. 
                          • Precious metals and public securities do not require a Fair Market Valuation as the value can be easily determined by the daily market updates.  
                          • If your account is subject to a required minimum distribution, updating the value may affect your RMD amounts.