[{"@context":"https:\/\/schema.org\/","@type":"BlogPosting","@id":"https:\/\/www.amorusolaw.com\/blog\/the-methods-of-a-qualified-appraisal-rye-brook-ny\/#BlogPosting","mainEntityOfPage":"https:\/\/www.amorusolaw.com\/blog\/the-methods-of-a-qualified-appraisal-rye-brook-ny\/","headline":"The Methods of a “Qualified Appraisal”","name":"The Methods of a “Qualified Appraisal”","description":"What makes an appraisal \u201cqualified,\u201d says the Tax Court, is whether it provides sufficient information to enable the Internal Revenue Service to evaluate an appraiser\u2019s methodology. When you give cash to charity, it is a pretty straightforward offering that holds a specific value. Easy enough. But what about non-cash items? Well, those must be appraised […]","datePublished":"2013-10-07","dateModified":"2023-08-12","author":{"@type":"Person","@id":"https:\/\/www.amorusolaw.com\/blog\/author\/amorusolaw\/#Person","name":"Amoruso & Amoruso LLP","url":"https:\/\/www.amorusolaw.com\/blog\/author\/amorusolaw\/","identifier":5,"image":{"@type":"ImageObject","@id":"https:\/\/secure.gravatar.com\/avatar\/12de032c04195e9c39a06a6d6eea182f7b4fa655c20e245f8094a244b5cdd0cb?s=96&d=mm&r=g","url":"https:\/\/secure.gravatar.com\/avatar\/12de032c04195e9c39a06a6d6eea182f7b4fa655c20e245f8094a244b5cdd0cb?s=96&d=mm&r=g","height":96,"width":96}},"publisher":{"@type":"Organization","name":"Amoruso & Amoruso LLP","logo":{"@type":"ImageObject","@id":"https:\/\/www.amorusolaw.com\/wp-content\/uploads\/2023\/07\/amoruso-logo.svg","url":"https:\/\/www.amorusolaw.com\/wp-content\/uploads\/2023\/07\/amoruso-logo.svg","width":0,"height":0}},"image":{"@type":"ImageObject","@id":"https:\/\/www.amorusolaw.com\/wp-content\/uploads\/2023\/04\/6a01901dd0a082970b019affc62291.jpg","url":"https:\/\/www.amorusolaw.com\/wp-content\/uploads\/2023\/04\/6a01901dd0a082970b019affc62291.jpg","height":600,"width":395},"url":"https:\/\/www.amorusolaw.com\/blog\/the-methods-of-a-qualified-appraisal-rye-brook-ny\/","about":["Estate Planning","Tax Planning"],"wordCount":410,"keywords":["Estate Planning","Qualified Appraisal","Tax Planning","Valuation"],"articleBody":"What makes an appraisal \u201cqualified,\u201d says the Tax Court, is whether it provides sufficient information to enable the Internal Revenue Service to evaluate an appraiser\u2019s methodology.When you give cash to charity, it is a pretty straightforward offering that holds a specific value. Easy enough. But what about non-cash items? Well, those must be appraised to determine (and justify) the value claimed by the donor. And furthermore, the appraisal must be a \u201cqualified appraisal.\u201dThe issue of valuation and taxation is an entirely opaque matter, to the tax court and taxpayers alike. WealthManagement.com recently attempted to provide some clarity in an article titled \u201c\u201cQualified Appraisal\u201d of Fa\u00e7ade Easement and Development Rights.\u201dThe article hinges on a fairly recent tax court matter known as Friedman v. Commissioner, but the issue of what qualifies as a \u201cqualified appraisal\u201d is age old. As you may well know, to give an asset that does not have a readily ascertainable monetary value requires a valuation for IRS purposes. This valuation, in turn, requires an independent expert to issue their \u201cqualified appraisal.\u201dUnfortunately, it is not always a simple matter. For instance, the qualified appraisal of stock in a privately held business is entirely different than the qualified appraisal of a unique piece of art. Moreover, neither the stock nor the art bear any resemblance to the fairly simple qualified valuation of a house.According to the WealthManagement.com article and the underlying tax case cited involving a fa\u00e7ade easement (a fairly intangible asset, you could say), what makes a \u201cqualified\u201d valuation is the clarity of the underlying methodology. Translation: the tax court must at least understand how a value was determined and that a relevant method was used to get there. Understandably, the tax court is not an expert on any given asset valuation, just the tax law. That said, the tax court may engage their own experts for their own appraisals, especially with items like artwork.Whatever basis the tax court uses, it just goes to show how intractable the problem of value is to the law. As for you, one planning for your assets and estate, it also goes to show the absolutely essential need to engage a qualified expert to produce a \u201cqualified appraisal\u201d regarding the value of your assets.Reference: WealthManagement.com (September 26, 2013) \u201c\u201cQualified Appraisal\u201d of Fa\u00e7ade Easement and Development Rights\u201dFor more information on asset preservation and estate planning, please visit my estate planning website."},{"@context":"https:\/\/schema.org\/","@type":"BreadcrumbList","itemListElement":[{"@type":"ListItem","position":1,"name":"Blog","item":"https:\/\/www.amorusolaw.com\/blog\/#breadcrumbitem"},{"@type":"ListItem","position":2,"name":"The Methods of a “Qualified Appraisal”","item":"https:\/\/www.amorusolaw.com\/blog\/the-methods-of-a-qualified-appraisal-rye-brook-ny\/#breadcrumbitem"}]}]