Summer 2010
Magazine

Personal property appraisers help clients on many different types of projects. In the last year I've worked with an artist who needed an appraisal for his insurance company after his artwork was destroyed in a flood; a couple updating their insurance after inheriting antiques from an aunt; another who donated property to a charity and needs to document the fair market value for a tax deduction and a family preparing to file federal estate taxes after the death of their mother.

Much of my work occurs after the death of a family member. But appraisers can also play a vital role as you're preparing your estate plans.

First of all, please remember I don't give financial or legal advice. For those types of questions, please contact your accountant or attorney. That having been said, here are some ways appraisers can help.

We all want to make things as easy as possible for our families upon our demise. That's why many people prepay funeral expenses, prepare family trusts, put little notes under those special vases or candlesticks. But by preparing an appraisal in advance, we may actually help save our heirs some money and avoid conflicts over our special treasures.

Families often need to know if the value of the personal property is high enough to push the value of the entire estate over the federal estate tax threshold or they need values so they can distribute the estate's property fairly among themselves.

If you know the value of your personal property assets as you prepare your plan, you may decide to donate some of them to charity and take a tax deduction now rather than keep them in your estate and risk paying estate tax. Or you may decide to give the items to your heirs during your lifetime. Maybe more important to you, you can facilitate the equitable distribution of your assets after your death. I've seen families go through a lot of stress trying to divide things equally after a loved one's passing.

The first thing to do though is to check with your attorney or tax advisor to see how all the rules apply to you. If you decide to have an appraisal done, here are some questions you should ask your appraiser:

Are you a “qualified appraiser” according to IRS regulations?

A qualified appraiser is one who:

• Performs appraisals on a regular basis
  
  
• Is qualified because of background, experience, education and membership in professional associations to appraise the type of property being valued. Is not an excluded individual:
  
  
• The owner of the property.
  
  
• Anyone employed by, related to or married to the client. • One who charges fees based on a percentage of the appraised value.
  
  
• One who has been prohibited from practicing before the IRS. • Do you belong to an appraisal society that tests its members?
  
  
• Do you take continuing education classes?
  
  
• How will you handle items outside your specialty area? A good appraiser will consult with other qualified appraisers on items not within the realm of their expertise.
  
  
• What is your fee and on what basis do you charge? Acceptable fees are those charged by the hour or by the piece. It's unethical to charge based on a percentage of the value of the property.
  
  
• What will the report look like? It should be a formal, typewritten report containing photographs and descriptions of the items being appraised.

None of us likes to confront our own mortality. (That's why our draft family trust has sat on our desk for quite a while!) But a little planning now can make things easier for our families down the road.

Joyce Newman, a certified member of the International Society of Appraisers, owns the northern Nevada art and antique appraisal firm Newman Appraisal Services. You can contact her at appraisals@gbis.com or (775) 771-0464 or visit the company's Website at www.newmanappraisalservices.com