Federal Regulations require these appraisals to meet all of the statutory requirements of a "Qualified Appraisal" and to be prepared by a "Qualified Appraiser". The specific definition of Fair Market Value as determined by [26 CFR, section 20.2031-1(b)] of the Treasury Regulations is used for these appraisals.  In general, these are relatively complex appraisals with more detailed explanations of how the fair market value was determined and slightly less emphasis placed on descriptions.  If State inheritance taxes are owed the specific requirements of the jurisdiction will dictate the value definition and requirements of the appraisal.  We're here to assist you in providing accurate, defensible value for the property in the estate.

Federal Regulations require the tax payer to provide an accurate Fair Market Value on Form 8283 for any property that was donated and for which a tax deduction is claimed.   At specific value levels a "Qualified Appraisal" is required and at higher values the appraisal must be filed with the tax return.  IRS publications offer guidance and explicitly state that an appraisal is generally warranted when donating jewelry due to the complex nature of determining its fair market value.  As with every tax related appraisal, it must be prepared by a "Qualified Appraiser" and meet very specific requirements within the IRS Regulations.  Many people make the mistake of using an insurance replacement valuation when determining the amount of the tax deduction. This could be a very costly error that subjects the donor to tax penalties and interest since the retail value of an item new is often much higher than the Fair Market Value of the item being donated. The specific definition of Fair Market Value as determined by [26 CFR section 1.170A-1(c)(2)] is used for these appraisals.

When non-cash gifts are received, an appraisal can help determine if the fair market value exceeds the amount specified by the IRS which may be transferred without tax liability and can also establish a “cost basis” for future tax functions such as “Capital Gains” determination.  If the gift is taxable, the appraisal will help in the determination of the amount of tax owed. These reports use the specific definition of Fair Market Value as determined by [26CFR 25.2512-1].  As with every tax related appraisal, it must meet the statutory requirements of a "Qualified Appraisal" and be prepared by a "Qualified Appraiser"

Under certain specific circumstances, a casualty loss of personal property may qualify for an income tax deduction. This type of appraisal requires a determination of the value at the time of acquisition, immediately prior to the loss and the value immediately after the loss occurred. Fair Market Value is used in each of those instances to arrive at the amount that may qualify for the tax deduction. These appraisals are complex and time-consuming, but necessary if a tax deduction for a casualty loss is taken when filing Form 4684.

Your Trustee will usually determine whether an appraisal is necessary, which items can be excluded and whether or not other types of value in addition to Fair Market Value are included in the report.  In general, we don't perform appraisals for bankruptcy; but, please feel free to contact us with your specific situation.