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MANAGING YOUR ACCOUNT

Everything You Need to Know About Fair Market Valuations

As your self-directed custodian, New Direction Trust Company is required by state and federal regulators to provide an accurate market valuation for all assets held in your self-directed account. One way we do this is by asking for a Fair Market Valuation (FMV) for each tax year. 

These FMVs can be easily submitted via the NDTCO Client Portal and are due by January 31, 2023 if the asset value is to be listed on IRA form 5498. 

 

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FAIR MARKET VALUATIONS

What to Know About FMVs

  • Log into the NDTCO Client Portal at https://portal.ndtco.com/.
  • On the Overview page, find the appropriate asset and click on Valuate in the righthand column.
    • If this is a real estate holding, you will need to click Take Action and then Valuate.
  • Provide any requested information and upload your supporting documentation.
  • Agree to the Terms & Conditions and click Submit. Done!

If the value of your investment fluctuates through the year, you may need an accurate market valuation. The following assets typically require an FMV: 

  • Real Estate
  • Private Equity
  • Checkbook IRA

Private loans, public equity, and precious metals do not require an FMV as they have a clear and easy-to-determine value. 

Examples of valid documentation:

  • Real Estate Appraisal by a Licensed Appraiser
  • Official Broker Price Opinion by a Licensed Real Estate Professional
  • Report from Independent Valuator
  • Comparative Market Analysis
  • Statement of Value Signed by an Authorized Officer of Company
  • Mortgage Statement
  • County Assessment

Examples of Qualified Third Parties for Assessment:

  • Managing Partner
  • Certified Real Estate Broker
  • CPA or Attorney
  • Certified Appraiser
  • Independent Valuation Company
  • Ideally, all FMVs will be received by NDTCO by January 31 to be used in the completion of IRS Tax Form 5498; however, all prior-year FMVs will be accepted until March 31.  
  • Any FMVs still in progress or sent in after March 31 will be recorded as of January 1 of the same year.  
  • We will now be accepting FMVs with dates based on when the FMV statement is provided, not the previously required date of December 31.  
  • You will need supporting documentation showing the value for each asset held in your account. The value provided needs to match the FMV form submitted.
  • You do not have to supply a valuation for any assets bought or funded during 2022.  
  • NDTCO no longer requires a valuator’s (or third party) signature on the FMV form.
  • K-1s cannot be used for fair market valuation as they provide historical data.    
  • If you have a Closely Held LLC, you will need to list and provide a value with supporting documents for each asset held by the LLC, including any cash held in the LLC.
  • Precious metals, public securities, and brokerage accounts do not require a Fair Market Valuation as the value can be easily determined by statements or a set valuation of the asset. 
  • The Internal Revenue Service (IRS) requires you to take an annual distribution from your retirement account beginning the year you reach the age of 72.
  • If your account is subject to a required minimum distribution, updating the value after Jan 31st may affect your RMD amounts.

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Need help with the Client Portal?

To get started with the client portal,  please log in with the username and password you created when you completed the new account online application. Your username is usually your email address, unless you manually changed it. 

If you have forgotten your username and/or password, go to the log in page and click “Forgot Password.” You can also reach out to the NDTCO Client Relations team at 877-742-1270, ex 191 with any questions. 

After your initial log-in, you will be prompted to choose and answer five security questions, which will be used to secure your account from future unauthorized access.