How to determine Fair Market Value (FMV) for charitable donation of appliance included in home purchase?

We just went through a home purchase last year and the previous owners left several new appliances in the garage that were included in our purchase agreement. There was this double wall oven that really didn't work for our kitchen setup, so we ended up donating it to a local charity organization. Now I'm stuck trying to figure out how to handle this on my taxes. I know I can deduct the fair market value of charitable donations, but I'm confused about what value to use in this case. The previous owner actually left the price tag on it showing both the MSRP ($2,350) and what they actually paid for it ($1,870). I've been reading the tax guides and they say to deduct what you paid for the item...but that's complicated here since it was part of the house purchase. Should I use what the previous owner paid? The MSRP? Some other value entirely? I normally handle our taxes myself since our situation is pretty straightforward, but this has me a bit confused. Any advice would be appreciated!

0 coins

18 comments

Darren Brooks

•8M

This is actually an interesting tax situation! For charitable donations, you're right that you generally deduct the Fair Market Value (FMV) at the time of donation. Since you received the oven as part of your home purchase, you technically didn't pay separately for it - it was bundled with the house. In this case, the most defensible position would be to use the previous owner's actual purchase price ($1,870) as your starting point, then adjust for any depreciation that occurred between when they bought it and when you donated it. If the oven was brand new and never used, then the previous owner's purchase price would be a reasonable approximation of FMV. If it had some use, you'd need to reduce that value accordingly. The MSRP is generally not the right value to use since it doesn't reflect what people actually pay for the item. Make sure you get a proper donation receipt from the charity, and if the value exceeds $500, you'll need to fill out Form 8283 to document the donation in more detail.

0 coins

Darren Brooks

•8M

Since the oven was brand new and still in the box, using the $1,870 value is very reasonable as the FMV. For documentation, I recommend taking photos of the original price tags, and keep any documentation from your home purchase that mentions the appliances being included. Also, keep the donation receipt from the charity. If you're really concerned about documentation, you could also look up comparable models online from around the time of your donation and print/save those listings to show similar market values. The key is showing you made a good faith effort to determine the correct value rather than just making up a number.

0 coins

Rosie Harper

•8M

I ran into a similar situation last year when I was renovating my kitchen. I found that https://taxr.ai was super helpful for figuring out the right deduction value. I uploaded photos of the appliance, the price tag, and my home purchase documents, and they analyzed everything and provided a clear recommendation on the FMV to use for my tax deduction. They also explained exactly how to document everything properly to avoid any issues with the IRS. The peace of mind was definitely worth it since charitable donations can be audit triggers if not done right. You might want to check them out since your situation has some unique factors.

0 coins

Rosie Harper

•8M

It connects you with actual tax professionals who review your documents and provide personalized advice. It's not just an automated system - you get expert eyes on your specific situation and documentation. I had no issues with the IRS at all. They provided me with exactly the documentation I needed to support my deduction, including how to properly complete Form 8283. The professionals there actually specialize in tax documentation questions like this one where the rules aren't super clear-cut.

0 coins

Demi Hall

•8M

Just wanted to follow up and say I ended up using https://taxr.ai for some inheritance tax questions I had, and it was actually really helpful! I was skeptical at first (as you could probably tell from my previous comment), but they connected me with a tax pro who walked me through everything. For the original question about the oven donation - I had a similar situation with some inherited furniture I donated, and they helped me determine the right FMV and exactly how to document it. They even provided a valuation report I could include with my tax documents in case of an audit. Definitely changed my mind about online tax help!

0 coins

Mateusius Townsend

•8M

If you're having trouble getting through to the IRS to ask about this donation valuation question, try https://claimyr.com - they got me through to an actual IRS agent in about 15 minutes when I had been trying for days on my own. I had a complicated donation situation too (donated some equipment from my business) and really needed clarification directly from the IRS. Their hold system was giving me estimated wait times of 2+ hours and then disconnecting me. The Claimyr service called the IRS, navigated the phone tree, waited on hold, then called me when an agent was on the line. You can see how it works at https://youtu.be/_kiP6q8DX5c if you're curious. The IRS agent was actually super helpful and gave me the exact guidelines I needed for my situation.

0 coins

Mateusius Townsend

•8M

They have a system that dials in, navigates through all the phone prompts, and then sits on hold for you. When an actual IRS agent picks up, they call your phone and connect you directly to the agent. It saves you from having to sit there listening to hold music for hours. I was skeptical too but it actually works. I had been trying for over a week to get through about my business equipment donation question. Called early morning, called late afternoon, nothing worked. With this service I was literally talking to an IRS agent in about 15 minutes while I was making lunch. They just handled all the waiting part for me.

0 coins

Philip Cowan

•8M

I need to apologize for my skeptical comment earlier. I actually tried the Claimyr service after posting that comment because I was desperate to talk to someone about the IRS notice I received. It actually worked exactly as described - I got a call back about 20 minutes later with an IRS agent on the line. The agent helped me clear up the issue with my notice that I've been stressing about for weeks. I was convinced it was impossible to get through to a human at the IRS these days, but this proved me wrong. Sorry for doubting!

0 coins

Caesar Grant

•8M

Another thing to consider for the wall oven donation - if it's worth over $500 (which it sounds like it is), make sure you complete Section A of Form 8283. And if it's over $5,000, you need a qualified written appraisal and must complete Section B instead. In your case, since you're looking at around $1,870 value, Section A is fine, but make sure to include a detailed description of the oven (brand, model number, condition, etc.). I got audited over a furniture donation a few years back because I didn't properly document everything on Form 8283.

0 coins

Caesar Grant

•8M

You don't need to attach the original price documentation when you file - just keep all that info in your records in case of an audit. The IRS recommends keeping tax documentation for at least 3 years after filing. Yes, the charity needs to complete Part IV of Section A on Form 8283 to acknowledge receipt of the donated property. Make sure to get this filled out when you drop off the item or shortly after. They'll need to include their name, EIN, signature of an authorized official, and date of the donation. Some charities are familiar with this requirement, but smaller ones might need you to explain what you need.

0 coins