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§ 10.1 VALUATION OF PROPERTYThe IRS amplified this rule, holding that the “most probative evidence of fairmarket [value] is the prices at which similar quantities of . . . [the property] aresold in arms’-length transactions.” 13 In a ruling concerning the deductibility ofbibles initially purchased at a “discount,” the IRS also stated that the fair marketvalue of gift property is determined by reference to the “most active and comparablemarket place at the time of the donor’s contribution.” 14The fair market value of an item of property is to be determined in the marketin which the item is “most commonly sold to the public.” 15 Normally, a sale“to the public” refers to a sale to the “retail customer who is the ultimate consumerof the property.” 16 The “ultimate consumer” is deemed to be a customerwho does not hold the item for subsequent resale. 17 In this context, the wordretail does not mean that the most expensive source is the only source for determiningfair market value. 18 The determination of the appropriate market for valuationpurposes is a question of fact. 19 In one instance, a court, in valuing acontributed newspaper collection, concluded that the wholesale market, not theretail market, was the appropriate market to use, because the ultimate consumersare newspaper collectors, newspaper dealers, and others interested in obtaininga newspaper collection, rather than individual purchasers (members of thegeneral public). 20 Once the appropriate market is identified, the fair marketvalue of the property involved is determined by the amount that consumerswould pay, in that market, for the property on the date of its contribution. 21The amount of a charitable contribution, determined for deduction purposes,can be affected by a restriction placed by the donor on the use of thedonated property. 22 In one instance, an agricultural college sought to acquire aparcel of land, consisting of 100 acres, to use in connection with its operations infarming research and development of new farming techniques. The owner of theproperty contributed 50 acres to the college under a deed of gift that carried arestrictive covenant providing that the land could be used only for agriculturalpurposes. Use of the land for agricultural purposes did not result in a specialbenefit to the donor. The “highest and best” use of the land was for a more valuableuse, however.The IRS said that the value of property contributed to a charitable organizationis the “price that a reasonably knowledgeable willing buyer would pay a13 Rev. Rul. 80-69, 1980-1 C.B. 55.14 Rev. Rul. 80-233, 1980-2 C.B. 69. The fair market value of a publicly traded security is not necessarily equalto its market quotation, its average trading price, or its face value. Reg. § 1.170A-13(c)(7)(xi)(D). A courtwrote that, “[n]evertheless, we assume that Congress believed that the existence of readily available marketquotations would substantially assist in, if not determine, fair market valuation (and discourage overvaluation).”Todd v. Commissioner, 118 T.C. 334, 345 (2002). This court then rejected valuation of stock on thebasis of a price suggested by a brokerage firm on the basis of the net asset value of the underlying enterprise,inasmuch as the share price did not necessarily reflect a price that any willing buyer or seller had accepted orwould accept.15 Reg. §§ 20.2031-1(b), 25.2512-1.16 Anselmo v. Commissioner, 80 T.C. 872, 882 (1983), aff’d, 757 F.2d 1208 (11th Cir. 1985).17 See, e.g., Goldman v. Commissioner, 388 F.2d 476 (6th Cir. 1967), aff’g 46 T.C. 136 (1966).18 Lio v. Commissioner, 85 T.C. 56, 70 (1985).19 See, e.g., Chou v. Commissioner, 58 T.C.M. (CCH) 1497 (1990).20 Arbini v. Commissioner, 81 T.C.M. (CCH) 1753 (2001).21 See, e.g., Goldstein v. Commissioner, 89 T.C. 535, 544 (1987).22 Rev. Rul. 85-99, 1985-2 C.B. 83. 357