Lyle corp. is a distributor of pharmaceuticals and sells only to retail drug stores. lyle received unsolicited samples of non-prescription drugs from a manufacturer. lyle donated these drugs to a qualified exempt organization and deducted their fair market value as a charitable contribution. what should be included as gross income in lyle's return for receipt of these samples
Fair market value should include as gross income in Lyles return for the receipt of these samples. It is the estimate of the market value of a property when the buyer and seller are knowledgeable and unpressured. Precedent or extrapolation helps in finding the Fair market value estimate.
