What Is an FMV Calculator and How Does it Work?
When you want to assess the total value of your assets under normal market conditions, you’ll need to use a fair market value (FMV) calculator. Without this helpful tool, it’s much most difficult to determine what the fair market value of your assets is.
you might be wondering what we mean when we refer to “assets” here. In this context, assets can be any number of things. For some people it may be their material possessions like their home, car, or personal items.
For others, the asset that needs valuation is a business or property. Depending on what assets need valuation, the scale at which your FMV calculator needs to operate will vary. That said, every FMV calculator does the same calculation to ensure its valuation is consistent with fair market conditions.
Consider when you’re selling your home or business. Before you can put either of these assets on the market for sale, you’ll need to have them appraised and assessed. An FMV calculator will be a significant tool in that process for you.
These calculators work by taking factors like point of purchase cost, comparable assets in the marketplace, replacement costs, and expert opinions into account. The basis of an FMV calculator‘s results is a culmination of reviewing these things.