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OTHER ASPECTS OF DEDUCTIBLE GIVINGand then donate the property to charity. The bankruptcy sale price may be theamount appropriately used to establish the property value. This happened, as anillustration, when the donee, a hospital, frequently purchased equipment atbankruptcy sales. 80 That outcome can also occur when the donor is a participantin a tax shelter scheme.The bankruptcy sale price, however, may not be the equivalent of the property’sfair market value. This aspect of the matter is grounded on the basic definitionof the term fair market value, which is the hypothetical sales price thatwould be negotiated between a knowledgeable and willing buyer and a knowledgeableand willing seller, neither of whom are compelled to buy or sell. 81In one instance, a court expressed disagreement with the proposition that abankruptcy court “was a willing seller not compelled to sell.” 82 In that case, concerninga subsequent contribution of hospital equipment, the court wrote that the“sale of equipment was made in haste, without objection from the creditors,and . . . there was no hearing on valuation.” 83 As part of a plan to establish a hospitalin a community, the donors and others purchased the equipment from abankruptcy court that was presiding over the liquidation of the assets of a bankrupthospital. The donors purchased the property for $40,000, then donated it forthe new hospital; on the basis of an appraisal, they claimed charitable contributiondeductions totaling $1,002,380. The court rejected the IRS’s attempt to confinethe charitable deductions to $40,000 and allowed the full claimed deductions,writing: “While it is true that these apparently altruistic efforts resulted in anincome tax windfall for the . . . [donors], this does not mean that they acted withan intent to defraud or that they are not entitled to the benefit of this windfall.” 84If the value of an item of property is determined by a trial court and the caseis appealed, the appellate court will likely expect some explanation from thelower court as to the basis for its conclusions. The court of appeals will not wantto have to speculate as to how the lower court arrived at its view of the value.Certainly, finding a valuation figure that has as its only virtue the fact that it iswithin the ranges suggested by the litigants’ expert witnesses will not suffice. Asone appellate court stated, it is not sufficient for the lower court to provide the“pieces of the puzzle”; the court of appeals undoubtedly will want the lowercourt to divulge “how it put them together.” 8580 Weitz v. Commissioner, 56 T.C.M. (CCH) 1422 (1989).81 See text accompanying note 9.82 Herman v. United States, 99-2 U.S.T.C. 50,899, at 89,984 (E.D. Tenn. 2000).83 Id. at 89,984.84 Id. at 89,985. Indeed, the court added that the “facts of this case suggest that the debtor-hospital’s Trusteegrossly undervalued the equipment in question to the detriment of the hospital’s creditors.” Id.85 Magnin Estate v. Commissioner, 184 F.3d 1074, 1081 (9th Cir. 1999). This court of appeals stated its standardof review in this regard in Leonard Pipeline Contractors v. Commissioner, 142 F.3d 1133 (9th Cir. 1998). Seealso Trompeter Estate v. Commissioner, 279 F.3d 767 (9th Cir. 2002), vacating & remanding 75 T.C.M.(CCH) 1653 (1998); Mitchell Estate v. Commissioner, 250 F.3d 696 (9th Cir. 2001), aff’g in part & rev’g inpart 74 T.C.M. (CCH) 872 (1997). A court, in a case involving the valuation of contributed real estate, “foundcredible the testimony of both [of the litigants’] experts” and therefore concluded that the “value of the donatedparcel at the time of its conveyance is most accurately reflected by a figure between those advocated by plaintiffand the government” (Frazee v. United States, 2004-1 U.S.T.C. 50,253 (D. Md. 2004)). Observing thatthe property appraisal process is “more an art than a science,” the court wrote that it is “thus compelled to applyits own artistic brush to establish a reasonable value for the land that accurately reflects all of the evidencepresented in this proceeding.” 364