Legal Basis in Determining the Fair Market Value of a Real Property
BIR Ruling No. 187-A-92 • Bureau of Internal Revenue (BIR) Issuances • Rulings (Numbered) • Jun 19, 1992
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June 19, 1992 BIR RULING NO. 187-A-92 81 (b) 000-00 187-A-92 Atty. Biddy Tiu Tan 75 Kitanlad Street Quezon City S i r : This refers to your letter dated February 24, 1992 requesting our opinion as to which of the hereunder enumerated valuation shall serve as the legal basis in determining the fair market value of a real property left to your clients, all of whom are heirs of a resident Filipino decedent who passed away on April 1, 1990, to wit: 1. five hundred (P500.00) pesos per square meter, which is the assessed value as of 1 April 1990; or 2. one thousand (P1,000.00) pesos per square meter, which is the zonal value as of 1 April 1990; or 3. two thousand five hundred (P2,500.00) pesos per square meter, which is the zonal value effective 1 June 1990. In reply, please be informed that pursuant to Section 81(b) of the Tax Code, as amended, the estate shall be appraised at its fair market value as of the time of death. However, the appraised value of real property as of the time of death shall be whichever is the higher of (1) The fair market value as determined by the Commissioner, or (2) The fair market value as shown in the schedule of values fixed by the Provincial and City Assessors. In view thereof, valuation number two (2) should apply. cdtech Very truly yours, EUFRACIO D. SANTOS Deputy Commissioner Officer-in-Charge
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