Publication 598 |
2001 Tax Year |
Indeterminate Price
If an organization acquires or improves property for an
indeterminate price (that is, neither the price nor the debt is
certain), the unadjusted basis and the initial acquisition
indebtedness are determined as follows, unless the organization
obtains the IRS's consent to use another method. The unadjusted basis
is the fair market value of the property or improvement on the date of
acquisition or completion of the improvement. The initial acquisition
indebtedness is the fair market value of the property or improvement
on the date of acquisition or completion of the improvement, less any
down payment or other initial payment applied to the principal debt.
The average adjusted basis and the average acquisition indebtedness
are then determined the same way as discussed earlier.
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